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COST KEEPING
AND MANAGEMENT
ENGINEERING
A TREATISE FOR ENGINEERS, CONTRACTORS AND
SUPERINTENDENTS ENGAGED IN THE
MANAGEMENT OF ENGINEERING
CONSTRUCTION
NET BOOK— This Book is supplied
to the trade on terms which do not
admit of discount.
THE MYRON C. CLARK PUBLISHING CO.
'cr American Society
of Engineering
of Mining
omotion
Consulting Engineer
Member American Society of Civil Engineers, Alember American Society
of Engineering Contractors, Member American Institute
of Mining Engineers
n//
NEW YORK AND CHICAGO
THE MYRON C. CLARK PUBLISHING CO.
>er'
ll
LONDON
E. 8c F. N. Spon. Ltd., 57 Haymarket
1909
\^^
COST KEEPING
AND MANAGEMENT
ENGINEERING
A TREATISE FOR ENGINEERS, CONTRACTORS AND
SUPERINTENDENTS ENGAGED IN THE
MANAGEMENT OF ENGINEERING
CONSTRUCTION
BY
HALBERT P. GILLETTE
Managing Editor, of Engineering-Contracting, Member American Society
of Civil Engineers, Member American Society of Engineering
Contractors, AI ember American Institute of Alining
Engineers, Member Society for the Promotion
of Engineering Education
AND
RICHARD T. DANA
Consulting Engineer
Member American Society of Civil Engineers, Member American Society
of Engineering Contractors, Member American Institute
of Mining Engineers Ox/
NEW YORK AND CHICAGO
THE MYRON C. CLARK PUBLISHING CO.
LONDON
E. & F. N. Spox, Ltd.. 57 Haymarket
Copyright 1909
BY
The Myron C. Clark. Publishing Co^
To Frederick W. Taylor, Past President of the
American Society of Mechanical Engineers, as a
tribute to his monumental work in applying the
methods of exact science to the problems of man-
agement engineering, this book is dedicated.
iii
PREFACE.
This book is intended to assist engineers, contractors and
superintendents in reducing construction costs to a minimum. To
accomplish this it is necessary to understand the laws or rules of
management, and to have daily reports that show the efficiency of
the men and machines employed. That there are any scientific
laws of management will be denied by many men of the old school,
but such a denial cannot be logically maintained. If there is a
science of psychology, there must be a science of management,
for management is a mental process that follows certain definite
laws, obscure and complex at times, but none the less definite when
once they are understood.
The Farady of the science of engineering management is
Mr. Frederick W. Taylor, Past President of the American So-
ciety of Mechanical Engineers, for he not only perceived and ap-
plied certain of the fundamental laws of management, but, in his
various papers, and particularly in his presidential address to the
American Society of Mechanical Engineers, gave definite verbal
form to the laws he had discovered.
In a subject so complex it is impossible for any one man to
discover all the laws of management. Each student of the sub-
ject will be able to add his quota, until, in the course of the next
few years, the science of engineering management will become as
complete as any of the other younger sciences.
We have spoken of the science of management as being a
branch of the science of psychology. It is, and it is more. Engi-
neering management involves not only the directing of the human
agents engaged in production but the economic application of the
forces of nature through the medium of machines. Hence engi-
neering management postulates a knowledge of the physical
sciences, and particularly the science of applied mechanics. Many
an ordinary foreman possesses a fair working knowledge of ap-
plied mechanics, having acquired it by observation and experi-
ment ; but such a foreman would be far more efficient as a man-
V
vi PREFACE.
ager if he also had a grasp of the theory of the principles that he
applies.
For example, it is of great assistance, in planning the organi-
zation of a working gang of men, to know well the simple law
that Work = Resistance X Distance, so as to apply this law con-
sciously rather than to apply it intuitively as does the ordinary
foreman. On the other hand, every engineer knows this law, but,
due to lack of proper instruction or training in engineering man-
agement, many engineers do not apply it when they are engaged
in construction management.
The science of engineering management involves, therefore,
a knowledge of certain elemental principles that control the action
of the human mind, combined with a knowledge of methods to
be used in applying the principles of the science of mechanics.
In the application of the laws of this new science of manage-
ment, the first requisite is a record of daily performance of each
working unit, whether the unit be an individual workman or a
gang of workmen. This recording of the performance of work-
men is termed cost keeping. Cost keeping, as we show in Chap-
ter V, is, in our sense of the term, a thing entirely different
from bookkeeping. Bookkeeping has been evolved by merchants,
and is essentially a system for showing debits and credits. Cost
keeping has been evolved by managing engineers, and is essen-
tially a system for showing the efficiency of workmen and of
machines. One of the most common blunders arises from at-
tempts to graft a cost keeping system upon a bookkeeping sys-
tem. The two should be kept entirely distinct, for reasons given
in Chapter V.
This is not the first book written on the general subject of
cost keeping, but it is, so far as we know, the first book on cost
keeping for managers of engineering construction in the field.
Cost keeping systems for manufacturers differ quite materially
from cost keeping systems for contractors or constructing engi-
neers. The contractor is a manufacturer, it is true, but he manu-
factures bridges, pavements, sewers, and the like, with a movable
plant, out in the open air, and, usually, with a gang of workmen
picked up for each particular job. The fact that the plant must
be installed and dismantled at comparatively short intervals,
coupled with the fact that the plant must be frequently shifted as
PREFACE. vii
the ^vork progresses, is alone sufficient to modify both methods
of management and methods of cost keeping ordinarily usi^d by
manufacturers. . Weather conditions cause still further modifica-
tions.
In no book hitherto published has an attempt been made to
present not only methods of cost keeping but the principles of the
science of engineering management. The two are so interrelated
that it seems best to discuss them as parts of one general subject.
It is, perhaps, not hoping too much that a book of this sort
will be soon adapted for use in the engineering colleges, because,
for every engineer who can find employment as a designer of
machines and structures, there are ten who can find employment
as the managers of structural operations and plants. As high an
order of engineering is required in mastering and applying the
laws of engineering management as is required in calculating a
stress or in selecting the means to resist it. Moreover, the greatest
financial rewards for engineering work go not so often to success-
ful designers as to successful managers. This may not be as it
should be, but it is the present condition and seems likely to re-
main so.
In this connection the authors would suggest that, on certain
kinds of work performed by engineering students, each student
should he required to report daily his own output. Thus, in field
surveying practice, each student should report the organization
of the surveying party, the time spent on the different operations,
and the amount of work performed. In stadia work, for example,
the number of "shots" taken from each station, the time required
to take them, and the time to shift the instrument from one station
to the next should be reported on a suitable report card. In draft-
ing work, a similar report should be made, giving the area of the
drawing, and, if possible, the total length of the individual lines
drawn.
Indeed, would it not be wise to run an engineering college
very much as a modern factory is run? Every student could be
regarded as a workman whose duty it is to report daily, and in
detail, his time spent and the number of units of work performed.
In some subjects the number of pages of lecture notes taken, or
the number of pages of text read and studied, would be the num-
ber of units of work performed. In other subjects the number
of problems solved would be recorded.
viii • PREFACE.
Thus, without burdening the students with additional hours
of work, the habit of recording work units and of analyzing out-
put would be formed — a habit of incalculable value to the future
manager of men.
Within the last few years a number of engineers have been
specializing as traveling instructors, if we may so call them, in
cost keeping and management, particularly in the field of manu-
facturing. Several of these engineers have been astonishingly
successful in reducing manufacturing costs ; but, what is equally
astonishing, they have found it exceedingly difficult to persuade
many manufacturers to give them an opportunity to improve ex-
isting conditions. The same difficulty confronts the engineer who
proposes to reduce construction costs for a contractor. The con-
tractor says to himself: "If this engineer can do all that he
claims to be able to do in reducing unit cost, he would not be
asking me to employ him, but would become a contractor him-
self." Reasoning of this sort is fallacious in that it fails to recog-
nize the fact that there is more to any business than a knowledge
of how to do things. There must also be means with which to do.
These means are, in many cases, cash capital. In other cases it is
an organization of experienced foremen and workmen. Even
capital cannot always buy such an organization. Years spent in
weeding out inefficients, and in training men, are required to
build up any organization. The intelligent engineer recognizes
this fact, and is not too eager to plunge into contracting on a
large scale, even if he can secure the necessary capital.
Finally, the world must always have its teachers — men with
the natural aptitude and liking for the work of instructing other
men how to do things. When this aptitude is strong, a man will
frequently care less for a great income, with its attendant worries,
than for an opportunity to exercise his talents. This fact is well
illustrated in every engineering college, where professors of
splendid mental strength devote their lives to training the minds
of young men, and do so for a recompense in money that is piti-
fully out of proportion to the class of work done and to the ability
displayed in doing it.
A knowledge of local conditions is often one of the greatest
assets of a contractor, and this, too, comes only from years of
experience. If an engineer skilled in the science of engineering
management can associate himself with a contractor having capi-
PREFACE. ix
tal, having an organization, and having a knowledge of local con-
ditions, the result is almost invariably a great reduction in unit
costs of construction.
Another obstacle that confronts the management engineer is
the beHef on the part of the contractor or manufacturer that he
himself can develop and install a satisfactory cost keeping system.
Often he can ; oftener he cannot, for he is apt to be like the man
who is his own lawyer and has a fool for a client. In this age of
specialization, it is about as much as any man can do to keep up
with the developments of his own specialty. This will be particu-
larly the case with management engineering, because it is one of
the youngest sciences.
Cost keeping is but a means to an end. The means is the
daily report showing what each unit of the organization has ac-
complished. The end is the economizing of labor and materials,
as a result of the scientific study of the cost reports and of special
timing records of performance. We have italicised the last clause,
because this is the thing that is usually overlooked by a contrac-
tor who is considering employing a managing engineer.
Cost records of themselves possess some value, but the great
value arises from the scientific study of those records. Who will
undertake to say that any ordinary manufacturer could have taken
the timing records made by Mr. Frederick W. Taylor and from
those records have deduced the methods of producing high speed
tool steel that revolutionized a great part of the steel working in-
dustry? Here it was that the brains and scientific knowledge of
the engineer came into play in interpreting the results of timing
records and in developing a great labor saving method.
The word engineer has the same derivative as the word in-
genious, as is particularly well seen in the French word for engi-
neer, which is ingenicur. It is one of the functions of the engi-
neer to invent — ^to exercise his talent of ingenuity. This is true
of the designing engineer and it is not less true of the managing
engineer. It is this very feature of engineering that gives the
profession a charm that is irresistible. It leads engineers to spend
their lives working more for the benefit of humanity than for
their own financial betterment. As a class, engineers are like all
inventors, careless of personal remuneration, craving the gratifi-
cation that comes from having conserved materials or from hav-
ing increased the output of men. The management engineer.
X PREFACE.
however, is more likely to receive a greater measure of reward for
his services than the designing engineer, for the results of his
work are more strikingly evident to those who employ him, to say
nothing of the fact that he is oftener able to patent devices that
he has designed during the process of studying how to reduce
operating and constructing costs.
For his efficient and painstaking labor in assisting in prepar-
ing cost keeping cards our acknowledgements are due to Mr.
Charles Houston.
We owe thanks to Mr. A. D. Mellar for his assistance in
the preparation of Chapter VII on bookkeeping.
Finally we, in common with the rest of the whole engineer-
ing profession, must acknowledge our indebtedness to Mr. Fred-
erick W. Taylor, the dean of cost analysts.
TABLE OF CONTENTS.
CHAPTER I.— THE TEN LAWS OF MANAGEMENT Page 1
( 1 ) The Law of Subdivision of Duties 1
(2) The Law of Educational Supervision 3
( 3) The Law of Co-ordination 5
( 4) The Law of Standard Performance Based on Motion
Timing 8
( 5) The Law of Divorce of Planning from Performance.... 10
( 6) The Law of Regular Unit Cost Reports 14
(7) The Law of Reward Increasing with Increased Per-
formance 15
( 8) The Law of Prompt Reward 16
(9) The Law of Competition 17
(10) The Law of Managerial Dignity 18
CHAPTER II.— RULES FOR SECURING MINIMUM COST 20
(I) The Sum of the Items of Unit Cost Must be a Minimun^,. 21
( 2) Work Every Element of Plant to Its Capacity 23
( 3) Reduce the Cost of Attending Machines, Even at the Ex-
pense of a Large Increase in Plant Charges 24
( 4) Transport and Handle Pieces in Groups, Each Group Being
the Unit Handled 26
( o) Make the Sum of the Items of Work a Minimum 27
( 6) Consider the Animal Body as a Machine 27
(7) Use Low-Priced Men for All Work of Mere Physical
Energy 29
( 8) Resolve Each Class of Construction Into the Elements of
Work Involved 29
( 9) Ascertain the Percentage of Dead Work in Conveying and
Elevating, to Determine Its Relative Importance 29
(10) Express Items of Cost as Percentages of the Total 30
(II) Express the Value of Lost Time in Percentages of Total
Cost 30
(12) In Selecting Plant, Consider the Unit Cost of Moving, etc. 30
(13) Make All Designs in the Office 31
(14) Keep Down the Ratio of Overhead Charges by Night Shift
Work 32
(15) Use Everv Possible Means to Avoid x\ccidents 32
(16) Do ihe Most Profitable Part of the Work First, to Avoid
Interest Charges 33
(17) Do as Much Work as Possible in a Yard or Shop 35
CHAPTER III— PIECE RATE, BONUS AND OTHER SYS-
TEMS OF PAYMENT Page 36
Profit Sharing 36
Piece Rate System 36
Bonus System 38
Differential Piece Rate System 38
General Plans on Which the Taylor System is Based 38
Differential Bonus 45
Task Work with a Bonus 45
Premium Plan 45
xi
xii CONTENTS.
Principles Governing the Fixing of a Piece Rate, etc 45
How to Fix the Wage Rate 47
The Stint System 48
CHAPTER IV.— MEASURING THE OUTPUT OF WORKMEN. 50
Subdivision of Units — and Rules Therefore 50
Units for Concrete Work 52
Two or More Units for the Same Class of Work 53
Uniformity in Units of Measurement 53
Units of Transportation 54
Recording Single Units '. 56
Record Cards Attached to Each Piece of Work 56
Measurements of Length 57
Measurements of Area 57
Measurements of Volume 58
Measurements of Weight 58
Functional Units of Measure 59
Stockpile Measurements 60
Key Units of Measure 61
Key Units on Drawings 61
Keys Marked on Separate Members 62
CHAPTER v.— COST KEEPING 64
Cost Keeping Defined 65
Differences Between Cost Keeping and Bookkeeping 65
Why Cost Keeping Records Should Be Kept Distinct from Book-
keeping Records Q(i
Time Keeping Defined 70
Daily Cost Reports, by Whom Made 71
Written Card vs. Punch Card Reports 71
Time Cards That Show Changes of Occupation 73
Gang Report Cards ■ 76
Individual Record Cards 80
Kind of Punches to Use 81
Size and Kind of Daily Report Cards. 81
Foreman's Diary 82
Designing Punch Card Reports, with Examples 82
Punch Card Showing Time and Occupation of Each Member of a
Gang 88
Duplicate Punch Cards 90
Record Cards for Each Piece of Work 92
Store Keeper's Reports 92
Reports on Materials and Supplies 94
Checking the Accuracy of Reports 96
Cost Charts 98
Progress Charts 102
Plistory and Sketches of the Work 108
CHAPTER VI.— OFFICE APPLIANCES AND METHODS 110
Time Clocks 110
Time Stamp 112
Rubber Stamp 113
Mimeograph 113
Counters 115
Adding Machines 115
Multiplying Machines 115
Slide Rule 116
Planimetcr 116
Wage Tables 116
CONTENTS. xiii
How to Systemize an Office 116
Order System by Means of a Card Index. 122
CHAPTER VII.— BOOKKEEPING FOR SMALL CONTRACTORS 127
Simplicity Essential ... 127
Fundamental Divisions of Cost 128
Analysis of Direct Expense Account 128
Analysis of Overhead Expense Account. 130
Gathering Data . 131
Office Labor 134
Field Materials . 134
Purchasing 135
Receiving 136
Duplicate Bills 137
Price Records .138
Field Supplies l:;w
Tool Record 1:>S
Office Supplies 139
Plant Depreciation .... . 139
Interest on Plant 141
Electricity Purchased 142
Miscellaneous Office Expense 142
Sub Contracts 143
General Miscellaneous Expense 143
Distribution of Expenditures 143
Summary Sheet 148
Profit and Loss Accounts 148
CHAPTER VIII.— MISCELLANEOUS COST REPORT BLANKS
AND SYSTEMS OF COST KEEPING 150
Various Cost Record Blanks for Written Records 150-161
Various Cost Record Blanks for Punch Records 162-172
A Flexible Cost Keeping System on Building Construction, with
Blank Forms 154
A Cost Keeping System on Sewer Work with Blanks 165
Cost Keeping on Sewer Work, with Blanks 186
Cost Keeping Blanks for Building Construction 188
Cost Keeping System of the Aberthaw Construction Co. with
Blanks 193
Cost Keeping on Rock Drill Work, with Illustrations 210
Forms for Recording Well Drilling Costs : 215
A Report Card System for Dredging Work, with Blanks 215
A System for Recording Costs of Dredging and Dredge Main-
tenance, with Blanks 220
Cost Keeping Blanks for Dredging, Portland, Ore 225
A Cost Record System on Flood Protection Works at Grand
Rapids, Mich 230
Forms for Breakwater Construction, Including Quarrying, etc... 238
Cost Keeping on Railroad Construction 247
System of Fred. T. Ley & Co. (Cost Keeping) 256
Record Card for Railway Section Foremen 264
A Cost Keeping-Bookkeeping System for Pipe Line Work, with
Blanks 266
Cost Keeping Svstem of the Kosmos Eng. Co., with Blanks 278
Blanks for Recording Work of Well Drills 283
Form for Keeping Account of Cars of Materials 284
A Blank Form for Recording Road Costs.. . 284
Cost Keeping Blanks fox* N. Y. State Road Work 287
CONTENTS.
Reprint of Discussions of a Paper on Cost Keeping by Mr. M. S.
Falk, from Trans. Am. Soc. C. E., LXIV, p. 401 288
By W. C. Hammatt , 288
By Emile Low 293
By F. N. Newell 298
'By Geo. Hill 306
Accounting and Cost Methods for Contractors, Being Some
Papers by Ernest McCullough, with Blanks 312
CHAPTER I.
THE TEN LAWS OF MANAGEMENT.
The managing of industrial enterprises, such as construction
work in the field, is still an art, and there are few who realize that
it can be reduced to a truly scientific basis. Nevertheless, there
are certain underlying principles of effective management of men
which may be expressed in the form of laws. Application of
these laws leads invariably to a greater output on the part of
workmen, and this invariability of result proves the scientific
basis of the laws. The most important of them can be grouped
under ten general headings, which are as follows:
1. The law of subdivision of duties.
2. The law of educational supervision.
3. The law of coordination.
4. The law of standard performance based on motion
timing.
5. The law of divorce of planning from performance.
6. The law of regular unit cost reports.
7. The law of reward increasing with increased perform-
ance.
8. The law of prompt reward.
9. The law of competition.
10. The law of managerial dignity.
Below are given the main characteristics of each:
The Law of Sub-Division of Duties. — Men are gifted with
faculties and muscles that differ extremely. One man will excel
at running a rock drill, another is better at lifting loads, a third
is clever in the application of arithmetic, a fourth is a born
teacher — and so through the gamut of human occupation. More-
over, practice serves to accentuate these inborn differences. It is
clear, therefore, that the fewer duties any one man has to per-
form, the easier it is to find men who can do the task well. But
give a man many duties to perform, and he is almost certain to
do at least one of them poorly, if, indeed, all are not miserably
attended to. Hence the following law of management: So
1
2 » COST KEEPING.
organize the zvork as to give each man a minimum number of
duties to perform.
This law needs little emphasizing as to its general truth, but
it is nevertheless ignored frequently by those who have not ap-
plied a scientific treatment to management. Thus, a foreman is
often charged with a multitude of duties. lie is expected, for
example, to watch the workmen and spur them to action when
slothful, to teach his men how to do their work in a more eco-
nomic fashion, to discover and remedy defects in the machines
and tools employed, to plan the arrival of materials at the proper
time and in the proper amount, to keep records of daily perform-
ance, etc., etc.
Mr. Fred W. Taylor was the first, we believe, to urge the
subdivision of the duties of foremen and to have what he calls
"functional foremen." One foreman, for example, is the machin-
ery and tool foreman. It is his sole duty to study the work done
by machines and tools, to effect improvements, to reduce delays,
and to supervise repairs.
Another foreman is the gang foreman. His function is to
organize the gangs, to direct their operation, and to instruct them
in the performance of their work.
A material foreman is employed on large jobs. His func-
tion is to confer with other foremen and ascertain what mate-
rials, machines and supplies will be needed. He orders the
materials, arranges for their shipment, and follows up the
manufacturing and railway companies to secure prompt delivery.
If necessary, he sends men to the factory, to the stone quarry,
or to the freight yard, to see to it that deliveries are made with
dispatch. Such a man is often invaluable, for upon him may
depend the entire progress of the work.
According to the magnitude of the contract there may be
different kinds of foremen, all coming in contact with the same
men, perhaps, but all performing different functions. Such
an organization as this differs radically from a military organiza-
tion wherein each man reports to only one superior officer on all
matters.
Most industrial organizations to-day resemble military or-
ganizations, with their generals and intermediate officers, down
to corporals, each man reporting to but one man higher in rank.
There is little doubt that the present tendency in, industrial
THE TEN LAWS OF MANAGEMENT. 3
organizations is to abandon the military system to a very large
extent, and for the following reasons:
A soldier has certain duties to perform, few in number, and
simple in kind. Hence the man directly in command can control
the actions of his subordinates easily and effectively. Control,
moreover, should come invariably from the same officer, to avoid
any possibility of disastrous confusion, and to insure the instant
action of a body of men as one single mass. .On. the other hand,
industrial operations do not possess the same simplicity, particu-
larly where men are using machines ; nor is there the necessity of
action in mass. The military organization, therefore, should be
modified to suit the conditions ; and one of these modifications is
the introduction of two or more foremen in charge of certain
functions or duties of the same men or groups of men.
On contract work it is often impossible to subdivide the
duties of men to as great an extent as can be done in large
manufacturing establishments. The smaller the contract, the
less the subdivision of duties possible. In such cases, an approach
to the ideal system of subdivision is secured not by employing
different men for different purposes, but by a systematic assign-
ment of duties to the same men to be performed at specified
hours of the day or days of the week. Thus, a small gang of
carpenters is engaged in bulling forms for concrete, in repairing
wooden dump cars, and in framing and erecting trestle work.
By timing the men, and by planning their work upon the timing
records and the requirements of the work, this carpenter gang
can be assigned certain hours or days for each class of w^ork.
Thus is avoided the intermittent and uncertain shifting of the
gang from one class of work to another, involving not only a
loss of time in frequent shifting but a loss of interest in work
that is done piecemeal. Moreover, a methodical change of occu-
pation permits a methodical record of the number of units of
each class of work performed, and thus leads to the use of the
bonus system of payment.
The Law of Educational Supervision. — It is not alone suf-
ficient to give instructions to workmen and foremen from time
to time by word of mouth, but the gist of all important instruc-
tions should be reduced to written or printed form. Among
contractors the pioneer observer of this law is Mr. Frank B.
Gilbreth, whose "Field System" is a 200-page book of rules for
4 COST KEEPING.
his superintendents, foremen and others to follow. His "Brick-
laying System" is another set of rules for the guidance of his
brick masons and foremen.
Among manufacturers there are many examples of those
who have prepared more or less elaborate sets of rules to be
followed, but the most interesting of these compilations that have
come to our attention is the one furnished to its salesmen by
the National Cash Register Co. In this book are gathered a vast
number of useful hints and practical suggestions and arguments
to be used in selling National cash registers. Each possible
objection that a prospective purchaser may raise is met with one
or more specific answers. This company not only provides its
salesmen with a text-book but has a school for training salesmen.
At regular intervals all the salesmen meet together and discuss
their respective methods of selling cash registers. Any new
suggestions that are good become subsequently a part of the
book of instructions. Thus the combined wisdom of hundreds
of salesmen is preserved and delivered to every salesman that
the company employs. This plan is followed also by many of
the life insurance companies. Railway companies have long
made it their practice to furnish their civil engineers with printed
sets of rules for railway location, as exemplified in McHenry's
^'Railway Location." All these are forms of educational super-
vision, and some are very elaborate. The small contractor need
not necessarily have a printed book of rules of his own making,
but he can supplement some such book of rules and hints by a
typewritten or mimeographed ser of sheets containing the most
important of his own instructions. In this manner the repetition
of a costly blunder by a foreman or workman can be avoided by
a special rule or hint, while a labor saving "trick" can be passed
on to other men in the contractor's employ.
In developing a system of educational supervision, the
greatest assistance can be obtained from articles in engineering
and contracting periodicals, for there will be frequently recorded
labor saving methods well worthy of trial by other contractors.
In a long article it may be only a small hint that is worthy of
being abstracted and placed among the hints for foremen.
In preparing a set of rules and hints, take pains to distin-
guish sharply between what is a rule always to be followed and
what is a hint to be followed optionally. It is well to have a set
THE TEN LAWS OF MANAGEMENT. 5
of rules, each with its specific number, and a separate set of
hints, also numbered.
The second law of management is briefly this :
Secure uniformity of procedure on the part of employees
by providing zvritten or printed rules, supplemented by educa-
tional suggestio}is or hints to guide them in their work.
The Law of Co-ordination.— vSc> schedule the performance of
each gang of men that they zvill zvork in perfect coordination
zi'ith other gaiigs, either adjacent or remote.
Perfect coordination involves the working of each man to
his capacity all the time. This necessitates not only the organiza-
tion of gangs of just the right size, but the prompt arrival of
standard supplies and materials, and freedom from breakdowns
of plant.
An examination of almost any piece of construction work in
progress will disclose the fact that most of the men spend a
considerable portion of their time waiting either for somebody
else to do something or for materials to arrive, before they can
proceed. The cause is improper coordination of the work. One
gang may have too many men, and therefore may be able to
work considerably faster than another, and be continually catch-
ing up with it. They will then adopt a slower pace, keep seem-
ingly busy, and manage to kill a large percentage of their
working time. These delays are chargeable to lack of coordina-
tion, although a careless inspection of the work may seem to
indicate that everything is going smoothly. A job can look
smooth and at the same time be so badly coordinated as to be
uneconomical.
The necessary adjuncts to proper coordination of work are
briefly as follows:
1. A carefully drawn schedule of performance.
2. Regular arrival of material and supplies.
3. Prompt and proper repairs to equipment.
4. The proper quality of supplies.
The best method that has so far been devised for making
things happen on time is first to prepare a time table, and then
to live up to it as far as the interruptions of the weather and
the limitations of human nature will permit. To prepare a time
table properly, it is necessary to know how fast work can be
done under the conditions which are to govern it. xA.t the best,
6 COST KEEPING.
there will be a considerable variation to be accounted for by
ignorance on the part of the planning department on the one
hand, and by the interference of the elements on the other. A
form of chart, made on tracing cloth, with various symbols to
indicate the kinds of work to be done, has been found very useful.
As the work progresses the performance can be checked off on
the chart, and thus indicate whether the work is proceeding on
time. Where the work is such as that of building construction,
and there is but little storage capacity for materials, it is best to
have the chart prepared a considerable time in advance, so that
materials will arrive when they are needed and yet not so much
in advance of the proper time as to require large storage capacity
at the site of the work.
The principal railroads now use, for preparing time tables,
a large blackboard on which the locations of stations are repre-
sented by ordinates and time by abscissas. Pins, over which are
stretched threads of different colors, indicate trains, and the run-
ning speed of each train and its direction can be noted at a glance
from the angle made by the thread with the horizontal. The
principle of this arrangement can well be applied to the prepara-
tion of time schedules which can be afterward made up in more
permanent form for record. Like the operation of a railroad,
but more so, a piece of construction will always be ahead of time
or behind time, and some parts may be ahead while others are
behind the schedule. For this reason a form of chart which will
admit of many alterations and additions is to be preferred to
one on which changes cannot easily be made.
On a large piece of contract work it is often not easy to
have on hand a very large supply of material, and the progress
of the work is thus dependent upon its regular arrival. The
man whose business it is to distribute and handle material will
have to be placed upon some other sort of work or laid off alto-
gether if the material fail. This can rarely be done without
considerable loss of time and impairment of the efficiency of the
men. When a man has been handling reinforcing bars until he
has become quite proficient in it, when he knows what sizes of
bars go in the different elements of the work, and what lengths
are called for in different parts of a structure, a portion of the
time spent in educating him to this point is likely to be lost if he
has to be unnecessarily thrown upon another kind of work, and
THE TEN LAWS OF MANAGEMENT. 7
it is very difficult to tell by ordinary inspection how much loss
of efficiency is involved. By shifting men on emergency in this
manner it is impossible to keep the work coordinated unless each
department has more than its economical number of men assigned
to it and a continual process of shifting takes place.
When times are dull and the railroads are not overloaded
with business, it is fairly easy to get railroad deliveries on time,
by seeing to it that shipments are promptly made ; while in times
of financial prosperity, when the railroads are congested with
freight, some consignees are sure to suffer from tardy delivery.
Therefore, under such circumstances, it is essential to have larger
stock piles and more storage capacity than when the railroads
are not busy.
It needs no argument to demonstrate that a derailed car, or
a broken steam shovel, or a wrecked derrick, is a sure obstacle
to any proper coordination of the work. The best way to avoid
break-downs is to keep the equipment in repair. Every engine-
man on the job should make a daily report in writing of the
condition of his engine when he leaves it at night, and these
reports should be filed just as regularly as any other records on
the work. It should be the business of some one daily to go over
these records and call the attention of the equipment foreman,
or some one acting in that capacity, to any trouble which may
cause interruptions to the service. Thus the equipment foreman
becomes responsible for a large proportion of the break-downs,
and he will see to it that these break-downs are as rare as
possible.
Poor supplies are likely to cause disarrangement of work.
There are few more expensive blunders than that of having the
wrong grade of dynamite for rock work, unless it may be to
have the right grade in the wrong condition, as when dynamite is
frozen.
Bad coal will upset the temper of the blacksmith and of his
steel, thus disorganizing the drilling operation sufficiently to
cause delays to that and to blasting. Where boilers are worked
under an "overload'' and require careful nursing on the part of
the fireman with good fuel, bad coal will cause a startling falling
off in performance and greatly impede the processes involved.
A 30 H. P. boiler with the best of fuel may be worked to a
8 ^ COST KEEPING.
35 H. P. rating, but then come down to a 20 H. P. rating upon
feeding it from a shipment of slaty coal.
Systematic inspection of supplies that have been purchased
under specification as to quality will eliminate most of this sort
of trouble.
The Law of Standard Performance Based on Motion Tim-
ing.— Nearly every •operation performed by a workman in-
volves several motions, although at first sight it may often seem
that there is but one.
Mr. Frank B. Gilbreth has coined the term "motion study"
to denote his method of observing the number and kind of mo-
tions made by a man — a bricklayer, for example — in performing
a given operation. His plan is to analyze the motions, assigning
a name to each motion. His next step is to endeavor so to
arrange the supply of materials, the position of tools, etc., as to
reduce the number of motions and the distance of each motion
to a minimum.
Mr. Fred W. Taylor was the first, we believe, to adopt the
practice of invariably studying each motion by the aid of a stop-
watch. A large number of stop-watch observations not only
give the average time of a motion, but, what Is of far greater
importance, they Indicate what the minimum time for each mo-
tion may reasonably be expected to be. It then follows that the
sum of these minimum times for the different motions represents
a standard time of accomplishment of the entire process. Hence
our law of motion timing :
In the performance of every process, the sum of the mini-
mum times observed for each motion gives a standard of per-
formance possible of attainment under sufficient incentive.
Mr. Harrington Emerson calls this standard of excellence
ioo%, and has developed the plan of rating all actual perform-
ances in percentages. Thus, if the standard time for drilling a
ID- ft. hole in a certain rock were 6o minutes and, if the actual
time were 90 minutes, this performance would be rated at 60 -r-
90 = 66.67%.
In establishing a standard time of performance, the first step
is to ascertain the unit times upon the work as ordinarily per-
formed. The next step is, by study of the time elements and
the local conditions, to eliminate as many motions as possible
THE TEN LAWS OF MANAGEMENT.
and to reduce the time of others, either by shortening the path
of motion, or by accelerating the velocity of the motion.
To illustrate by an example, we give the following time
study, which was made by one of the authors some time ago on
some cableway work. Since this was done the Lidgerwood Mfg.
Co. have completely redesigned their cableway engine and fall
rope carriers and have introduced new features in control (not-
ably in the Gatuii cableways in Panama). Therefore, while the
data are correct as history, they must not be taken as indicating
the limit of present possibility. A considerable number of stu-
dies was made, but one only is given for purposes of illustration :
TABLE I.
1908. Cableway No. 2, Handling Concrete.
Efficiency.
Observa- Min. Ave. Max. Standard Per
Process. tions. time. time. time. time. cent.
Rl 40 -ft 30 6.0 10.5 17.3 6.0 57.1
Tl 470 ft 33 31.0 47.3 63.0 31.0 65.5
Fl 123 ft 37 22.0 30.8 44.7 22.0 71.5
D 37 16.8 61.7 140.4 16.8 27.2
Re 123 ft 36 19.4 23.7 29.3 19.0 80.4
Te 470 ft 36 26.5 37.2 64.5 26.5 71.2
Fe 40 ft 35 11.0 42.9 96.0 11.0 25.6
L 28 12.0 '73.2 234.0 9.4 12.8
144.7 327.3 689.2 141.7
Totals, 1,266 ft.
TABLE II.
1908. Cableway No. 3, Handling Concrete.
Efficiency.
Observa- Min. Ave. Max. Standard Per
Process. tions. time. time. time. time. cent.
Rl 40 ft 18 8.0 13.6 18.2 6.0 44.1
Tl 470 ft 17 35.5 39.3 68.0 31.0 78.0
Fl 123 ft. 21 25.0 39.4 77.0 22.0 55.9
D 22 20.0 62.5 119.0 16.8 26.9
Re 123 ft 22 19.0 28.5 36.0 19.0 66.8
Te 470 ft 22 30.0 46.6 102.0 26.5 56.9
Fe 40 ft 20 18.0 29.1 48.0 11.0 37.8
L 16 38.0- 75.6 220.0 9.4 12.4
193.5 334.6 688.2 141.7
The first column gives the abbreviations of the processes,
distances, etc. ; the second gives the number of recorded observa-
tions on each process; the third gives the minimum observed
time in seconds for each process in that table; the fourth gives
the average; the fifth gives the maximum time; the sixth gives
the minimum of all the observed times for each process. While
this is by no means the shortest possible time in which the process
could be accomplished, it is the shortest one observed, and has
10 ^ COST KEEPING.
here been taken to represent standard (ioo%) efficiency. By
dividing the standard time by the average for each process the
average efficiency as observed is obtained. This is shown in the
seventh column.
As a result of this time study, it was possible to make an
estimate of the probable increase in efficiency that could be
obtained by rebalancing the engines. A further improvement was
discovered in the method used in signaling to the operator, and
an estimate of the saving to be obtained in this manner was
made. A further improvement in regard to the position of the
operator was discovered. A collateral improvement was per-
ceived in the line of altering the design of the towers, so that
the cost per unit of handling materials could be reduced, and
further suggestions of a confidential nature, which we are not
at liberty to discuss here, were made.
The Law of Divorce of Planning From Performance. — As
a corollary to the law of the subdivision of duties, we have the
law of divorce of planning from performance, first formulated by
Mr. Taylor.
According to the old style method of management, each
foreman is left largely to his own resources in planning methods,
in addition to his other functions. This multiplicity of duties
can be properly performed only by a foreman possessed of a
multiplicity of talents. Since few men can comply with such a
specification for brains, it follows that good foremen of the old
style are rare indeed. The modern system of management con-
sists, as far as possible, in taking away from the foremen the
function of planning the work, and in providing a department to
do the planning. Under planning we include inventing, that is,
the improvement of existing methods and machines.
A common error in management is the assumption that the
man on the job in direct charge of the work is the man best fitted
to plan and improve. Nothing is further from the truth. Rare,
indeed, is the man possessed of a trained inventive faculty, and
it requires such a faculty not only to develop new methods and
machines but to plan the use of any machine with greatest
economy. Nearly every piece of contract work presents new
conditions, and this solving of new economic problems is beyond
the power of any but the trained and skilled economist. But
THE TEN LAWS OF MANAGEMENT. n
even where the problems remain identical, the necessity of a
divorce of planning from performance exists, as we shall indicate.
The brain is an organ that requires frequent exercise in
doing the same thing before it becomes proficient enough not to
suffer great fatigue. Thus, the man who is learning to ride a
bicycle finds that half an hour's lesson has tired him more than
ten hours' work at his accustomed occupation. Attempting to do
something new is wearisome beyond measure, except to the mind
whose training has been in solving new problems. Hence the
ordinary man finds much fatigue and little pleasure in attempting
to do his work in a fashion that differs at all from that to which
he has long been accustomed. The mental inertia that resists
a change in methods of performing work is almost beyond com-
prehension, and it is found not only in the lowest type of work-
man but in the highest.
Repetition develops skill, and skill gives pleasure. To a
strong man used to his work there is actual pleasure in mowing
hay, as Tolstoi has admirably pictured in one of his novels.
Conversely, fatigue merges into pain and is repulsive.
In addition to these fundamental reasons why men adhere
to precedent in their performance, there is the fear of ridicule in
case of failure to succeed in any new attempt. The child learns
to speak a foreign language more rapidly than an adult not only
because of a more ''flexible tongue" but because it does not fear
laughter at its blunders. Partial failure is expected of the child,
and it is not ridiculed. But an adult seems witless if he does
not immediately learn the new word and its pronunciation ; hence
the laughter. So it is with every new performance. Further-
more, a serious mistake may lead to the loss of a position, thus
adding another reason for sticking to the "good old way."
Finally, there is no method so fruitful in effecting improve-
ments in methods and machines as a study of the time required
to perform each movement or operation. A workman or fore-
man rarely studies his own work in this manner. Hence his
experience, upon which he is wont to brag, is like the experience
of the swallow building its nest — an unchanging adherence to
precedent, regardless of possibilities of improvement.
It is a significant fact that nearly all the great inventions
have been the product of brains divorced from the actual per-
formance of the machines that they have invented. Eli Whitney,
12 COST KEEPING.
inventor of the cotton gin, was a lawyer, and not even a southern
planter. Smiles' "Self Help" is a volume full of instances of
important inventions made by men remotely, if at all, connected
with the class of industry in which their machines are used.
Nothing, therefore, is more ridiculously illogical than the com-
mon belief that the ''men behind the gun" are either capable of
being the inventors of the gun or the ones most likely to improve
it. Yet it is this illogical belief that prevents railway companies,
manufacturers and contractors from making hundreds of radical
economic improvements.
There is another difficulty, one which is most insidious and
not generally recognized among contractors. It depends upon a
mental peculiarity, to which we know of not a single exception,
which becomes increasingly evident as a man's familiarity with
the work develops. The fact referred to is this: A field chief
can see inefficiencies in operation and prescribe remedies far more
unerringly when his personal active touch with any one piece
of work is intermittent than when one job is his constant care.
The ultimate reason for this fact belongs to the science of psy-
chology rather than engineering, and its theoretical investigation
is not our present concern, but the fact is there and it has got to
be respected. Coming back to a job after two or three days
spent on another kind of work, with another kind of responsibility
and among another set of men, things are seen that were not
before suspected, and the prejudices of practice, as they may be
called, are offset by the distraction of other fields, without the
analytical perception having had the opportunity to grow rusty
from disuse.
Still another fact, equally important, equally elusive, equally
difficult to demonstrate to the theorist who has not had field
experience and to the old-timer who is hide-bound by precedent,
is this : A man, no matter who he is, can do his work better,
vastly more efficiently, when he is being coached than when he is
his own guide, philosopher and friend. Why this is true we will
not here take the time and the space to discuss. It is true at a
rifle range, on the baseball diamond, on the football field, in
rowing, in track athletics, in the machine shop, and in field con-
struction work. A man can steal third base better under coach-
ing, even with the handicap of the impressions having to go
through the mind of the coach before he can make use of them,
THE TEN LAWS OF MANAGEMENT. 13
a matter involving a considerable interval of time. The coach
must know his business, of course, and have the confidence of
the worker; and in its field application the cost of the coaching
must not be excessive, nor need it be. A coach can act in that
capacity to a good many men at once, and, if he be allowed to
confine himself to just one function for a considerable time, he
can obtain a control of other men on this function that is aston-
ishing. This is the basis of the employment of functional fore-
men first developed by Taylor.
We might multiply instances indefinitely, but it is clear from
the above that the economic systemizing of any specific piece of
work of any considerable size must be done by a thoroughly disci-
plined and well trained staff under the leadership and direction of
the best man available ; and it is further evident that if the services
of the field chief on any one job can be made intermittent, visits
being at reasonably short intervals, his efficiency will be a maxi-
mum. The superintendent in charge of the work has a continu-
ous responsibility and a continual care. His coach, his friend
and his chief must have a broader and a less confining field.
Not being on the job continuously, the chief will obtain un-
fair impressions unless fortified by an efficient and well ordered
cost keeping system.
In agreement with the three preceding paragraphs, it has
been found that the reorganizing of work is done much more
efficiently by men who have not been a part of the permanent
organization, than when attempted by an old employee on the
work. This statement applies to large organizations as well as
small, and has been proven true on the railroad, in the shop and
in the construction field time and time again; and the fact fre-
quently offers a particularly unfortunate obstacle to the employ-
ment of the best men for the work, because many men in the
construction business dislike to entrust their trade secrets to an
outsider. As a matter of fact, the trade secrets on construction
work that are worth concealing, if shaken up in an ordinary
peanut shell, would make a distinct rattle; but a contractor
seldom likes to have his precise costs known outside of his own
organization, lest someone else might have an advantage in bid-
ding against him. He has confidence that the men in his own
employ will not give away his figures to his business rivals and
he has not the same confidence with regard to a rank outsider.
14 COST KEEPING.
In practice, however, it works out differently. The employee
who has gained such knowledge of the business as to make his
information valuable can, and often does, better his job by going
over to another contractor. The outside expert is under the
strictest obligation of professional honor not to betray to one
client the secrets of another, and we have yet to learn of such
a thing being done by men with a reputation to sustain. A con-
tractor's "costs" are safer in the hands of his consulting engineer
than in his own office.
Summing up, we have this law :
For maximum economy of performance, the planning of
methods of doing zvork should be the sole fnnction of a manager
who is not a workman himself nor in direct charge of the
workmen.
The Law of Regular Unit Cost Reports. — Having planned
a method of performance, it becomes necessary to secure daily,
weekly and monthly reports of such completeness that a manager
can tell, almost at a glance, what the actual and relative perform-
ances are. This systematic reporting is more fully treated under
the head of cost keeping. The success of nearly all large cor-
porations, such as the Standard Oil Company, is due, in large
measure, to a system of regular reports that put the various
managers in constant touch with the performance of the men
under them. Reports to be of much value must come at short,
regular intervals, must be in the same form, and must show
quantitative results that admit of instant comparison with pre-
vious reports. To permit comparison there must be either simi-
larity of conditions, or there must be a reduction to units that
are themselves practically identical. For example, a weekly
record of the number of yards of earth excavated and hauled at
a given unit cost is usually of little or no value to the manager
unless there is a further subdivision of units of cost. The cost
of loading per cubic yard should be segregated from the cost of
hauling, so that the cost of hauling can itself be expressed in
the unit of the yard-mile or ton-mile haulec].
The law of regular unit cost reports may be formulated as
follows : Report all costs in terms of units of such character
that comparison becomes possible even under changing condi-
tions, and let these reports be made daily if possible, zveekly in
any event, and zvith a monthly summary.
THE TEN LAWS OF MANAGEMENT. 15
It is in the adherence to the terms of this law that managers
of contract work in the field will find their greatest difficulty.
First, there is the difficulty of selecting suitable units upon which
to report costs. In pavement work, the square yard is a conve-
nient unit and the number of units is easily measured daily. But
in reinforced concrete building construction, there is needed not
merely the cubic foot or cubic yard unit, but many others, some
of which are not easily ascertained every day.
For example, the pound of steel reinforcement is one unit
upon which reports should be made, for the number of pounds
of steel per cubic yard of concrete differs widely. The thousand-
feet board measure in the forms is another necessary unit, and
the square foot of concrete area covered by the forms is still
another. Yet these and other units must be used to admit of
any rational comparison of performance from day to day and
week to week.
Furthermore, such units must be properly selected for the
still more important purpose of paying the workmen according
to any bonus system. In another chapter we discuss this prob-
lem of selecting units of measurement at considerable length, for
upon such selection depends the success of contract work under
the modern method of management.
The Law of Reward Increasing With Increased Perform-
ance.— All pay incuts for zcork should he proportionate to the
z^'ork done. This is the fundamental law of economic produc-
tion. When this law is ignored — and it is partly ignored to-day
on practically every class of work — the producer ceases to take
keen interest in his work. Under the common wage system of
payment, one brick mason receives as much as another, regard-
less of skill and energ}\ Individual incentive is lacking, save
as it is supplied by fear of discharge. When laborers, working
under the wage system, are put at the task of shoveling earth
into a wagon, each man seeks to do as little as his neighbor, and
the slowest becomes the pacemaker for the rest. Such ambition
as any individual may possess is stifled by the knowledge that
his increased output will never be known by his employer, and
consequently never rewarded. IMoreover; an ambitious man in
such a gang is chided by his fellows who warn him not to set a
"bad example" by working himself out of a job.
The wage system is responsible in the first place for lack of
I6 COST KEEPING.
sufficient incentive to good performance, but its vicious effects
have been greatly augmented by the stupid actions of many labor
unions, such as the restriction of daily output, the limiting of
the number of apprentices, the demanding of wages that have no
relation whatever to the output of individuals, the refusal to
work under foremen who are not also members of the union, the
refusal to do any sort of work except that prescribed by the
union, and the like. In the long run, all such restriction of out-
put, whether due to the lack of sufficient incentive, or to the rules
of labor unions, or to the customs of a country crystallized into
castes such as exist in India, lead to a reward commensurate
with the output. Summing up : The wage received becomes ulti-
mately proportionate to the output. The high wages prevalent
in America are due neither to labor unions, as some profess to
suppose, nor to abundance of natural resources, but to the fact
that in America labor unions have not thus far greatly restricted
the output of individuals except in a few trades, and more par-
ticularly to the fact that they have not opposed the introduction
of labor saving machinery. In addition, American managers are
far in advance of all others in their recognition of the funda-
mental law of management — namely, that the reward should be
proportionate to the performance. Hampered though they have
been by the wage system, American managers have been liberal
in their policy of payments for work performed. In recognition
of his share in the greater output of earth excavation, the steam
shovel engineman in the United States receives $125.00 to $175.00
a month.
Within the past decade still further strides have been made
by American managers toward a more effective recognition of
this fundamental law of proportionate reward. Various systems
of payment, known as the bonus system, the differential piece
rate system, and the like, have come into more general use, and
even the old piece rate system has received a new lease of life,
all tending wonderfully to stimulate the energy and wits of
workmen, because they are in accord with the law of propor-
tionate reward.
The Law of Prompt Reward. — Any reward or punish-
ment that is remote in the time of its application has a relatively
faint influence in determining the average man's conduct. To be
most effective, the reward or punishment must follow swiftly
THE TEN LAWS OF MANAGEMENT.
17
upon the act. Hence a managerial policy that may be otherwise
good is likely to fail if there is not a prompt reward for excel-
lence. Most profit-sharing systems have failed, principally be-
cause of failure to recognize the necessity of prompt reward, as
well as because of failure to recognize the necessity of individual
incentive.
The lower the scale of intelligence, the more prompt should
be the reward. A common laborer should receive at least a state-
ment of what he has earned every day. If, in the morning, he
receives a card stating that he earned $2.10 the previous day, he
will go at his task with a vim, hoping to do better. But if he
does not know what he has earned until the end of a week, his
imagination is not apt to be vivid enough to spur him to do his
best.
A daily or zveekly statement of earnings, followed by prompt
payment, is a stimulus essential in securing the maximum output
of zvorkmen.
The Law of Competition.— The pleasure of a competitive
game lies in conquering an opponent, and this follows logically
from the fact that competitive games are an evolution from the
primitive chase or battle. Work conducted as a competition
becomes a game, and thus stimulates those engaged not only to
strive with great energy but to derive keen pleasure from the
contest. The business man who continues to pile up millions,
long after his wealth is sufficient to satisfy every possible want,
does so from pure joy in the contest to excel others engaged in
the same business. He is following the law of competitive work.
By pitting one gang of workmen against another gang, the
spirit of contest is easily aroused. But it is impossible to main-
tain this spirit indefinitely without following the seventh law of
management of men — namely, by making the reward proportion-
ate to the performance. When, however, this seventh law of
management is observed, an added spirit is given to men by pit-
ting one gang against another. Thus, in laying concrete by hand
for a pavement, the best method is to have two distinct gangs
working side by side, each gang concreting from the center of
the street to the curb. When this is done under a bonus system
of payment, the output is astonishing.
Where competing workmen cannot see one another's output,
a bulletin board should be used, whereon the number of units of
l8 • COST KEEPING.
work performed by each man or each gang of men should be
posted.
Conz'ert work into a competitive game by oi'ganimng com-
peting gangs of men and by posting their performance.
The Law of Managerial Dignity. — That there should be
anything like caste among managers seems, at first, repulsive to
democratic principles of government, whether the government
be political or industrial. Nevertheless, a study of the personality
of the most successful managers usually discloses a characteristic
of firmness coupled with a sort of austere dignity. The best
manager is never "one of the boys."
Managerial control reaches its acme of excellence in the
army, and there we find class distinctions most scrupulously
observed. The officers do not "mess" with the men, nor do they
form close friendships with the soldiers in the ranks.
Familiarity breeds contempt, or it breeds at least a feeling
that the great man is not so great after all. All managers are
under the constant fire of criticism of their subordinates, whether
they realize it or not. The best shield that a manager can wear
is distance. His little foibles — and all men have them — may thus
be kept concealed. It is essential that they be concealed, for men
of less mental endowment will always seize upon the little de-
fects of greater men's character or attainment as evidence of
lack of any real superiority. The eye of criticism is a miscroscope
for human frailties. Being a microscope, it is wise to keep
beyond its range, so that the whole character may be viewed by
the naked eye in its true perspective.
Discipline in an industrial army is as essential as in a mili-
tary organization, and it is best secured by military methods.
This involves: (i) The social separation of the officers from
the men; and (2) a sequence of responsibility from the man in
the ranks to the highest officer.
For every act on the work every man should be responsible
to some particular man higher in authority. There should never
be any doubt as to whom a man is responsible ; but it does not
follow that a man should be responsible to only one person,
except for certain acts. As we have previously shown, an indus-
trial organization may have several classes of foremen, to each
of whom each workman is responsible for certain acts. What
we now emphasize is the importance of not dividing the respon-
THE TEN LAWS OF MANAGEMENT. 19
sibility for any particular act. A contractor, for example, should
rarely give any orders to a workman. All orders should come
through the proper foreman. To do otherwise results not only
in reducing the workman's respect for the foreman, but it fre-
quently angers the foreman, who feels that he has lost dignity in
the eyes of the workmen.
It is often wise to change foremen from one gang to another,
in order to preserve the class distinction between foremen and
men. As foremen become acquainted with the men, they gen-
erally want to be regarded as good fellows, and will then permit
infractions of rules and a general decrease in activity. Who has
not noticed that short jobs usually move with a "snap" that is not
always characteristic of longer jobs?
We may sum up thus :
Discipline is best secured by managerial dignity, and dignity
is best preserved by social separation of managers from subordi-
nates and by an invariable sequence of responsibility.
CHAPTER II.
RULES FOR SECURING MINIMUM COST.
In our own work we have found it of great advantage to
formulate certain rules for reducing costs ; for a study of specific
general principles leads to many improvements in management
that would not occur if reliance were placed upon haphazard
attempts to reduce costs. The following are some useful rules:
1. The sum of the items of unit cost must be a minimum.
2. Work every element of a plant to its capacity.
3. Since the principal factor of the unit cost of production
where power machines are used is the labor of attending the
machines, reduce the cost of this attendance even at the expense
of a large increase in plant charges.
4. Transport and handle pieces in groups, e^ch group being
the unit handled.
5. Make the sum of the items of work, measured in foot-
pounds, a minimum.
6. Consider the animal body, whether of a man or a horse,
as a machine burning a limited amount of fuel daily, in the form
of food, and therefore having a limited daily capacity for work.
7. Use low-priced men to do all work involving merely
foot-pounds of energy.
8. Resolve each class of construction into the elements of
work involved and study means of reducing the foot-pounds of
each element.
9. Ascertain the percentage of dead work done in convey-
ing and elevating material, with a view to determining its rela-
tive importance and thus deciding upon what it is worth to re-
duce it.
10. Express all items of cost as percentages of the total, to
ascertain the relative economic importance of each item and thus
determine where it is best to make the first efforts at cost reduc-
tion.
11. Express the value of all lost time in percentages of the
20
RULES FOR SECURING MINIMUM COST. 21
total cost of each part of the work, classifying the various
items.
12. In selecting plant consider particularly the unit cost of
moving and shifting it and the cost of lost time.
13. Make all designs for work, whether permanent or tem-
porary, in the office as far as possible, instead of leaving this to
the ingenuity of foremen or carpenters, to be done in the field.
14. Keep down the ratio of overhead charges to direct
charges by night shift work.
15. Use every possible means to avoid accidents to plant
by proper inspection and study of precautionary measures.
16. Do the most profitable part of the work first wherever
possible, so as to avoid carrying interest charges.
17. Do as much work as possible in a yard or shop instead
of in the field.
Rule I.— r/zc sum of the items of unit cost must be a mini-
mum. These items are:
a. Plant and tool charges.
b. Operating labor charges.
c. Material.
d. Preparator}' and incidental charges.
e. Cash capital.
f. Overhead charges.
The plant and tool charges comprise :
1. Interest.
2. Depreciation.
3. Repairs.
4. Installing and removing, including freight.
5: Shifting during construction.
6. Supplies, such as fuel, oil, waste, etc.
7. Watchman.
8. Storage during idle periods.
9. Insurance.
The total plant charges for an average year must be calcu-
lated and divided by the total number of units of product for an
average year, or for the fiscal period on the basis of which the
work in question is to be considered. This result will give the
unit plant charge.
The operating labor charges comprise the labor which is
directly productive, such as that of a man handling a pick and
22 COST KEEPING.
shovel; it comprises the incidental labor, such as that of the
water boy, etc. ; the monthly labor, such as that of the timekeeper
and storekeeper; and the labor of superintendence. The sum of
the amounts paid for this labor for the fiscal period under exam-
ination divided by the total number of units of product will be
the total unit labor charge.
The total cost of material for a given result, or for a given
period, divided by the total number of units of product, will be
the total unit material charge.
The sum of all the charges for getting ready to do work
which are not plant charges and which are incidental to the
particular job handled, and yet not necessarily proportionate to
the amount of work to be done, divided by the total units of
product or profitable work upon the job for which these inci-
dental charges are incurred, will be the total unit preparatory
charge.
The interest upon the cash capital involved for a given
period divided by the number of units of product or profitable
work of each kind for a period under investigation will be the
total unit capital charge.
The total charges which are not directly apportionable to
any one job, and yet are essential to running the business, divided
by the total number of units of product or profitable work han-
dled by the entire organization for an average fiscal period, will
be the total unit overhead charge.
The sum of these six unit charges should be a minimum in
order to obtain the minimum cost. It naturally follows that it
is not necessary for each of these items to be itself a minimum,
since, if by an increase in the unit plant charge, the unit labor
charge can be more than proportionately decreased, there is a
resultant economy ; and, similarly, if by increasing, even tem-
porarily, the unit overhead charge, the efficiency of the general
work can be sufficiently improved, the total economy will be
increased.
It is very important to consider items 4 and 5 of plant
charges, for it often happens that a plant that is too large and
too expensive is employed on work which is not heavy enough
to justify such a plant. The use of a 90-ton steam shovel, costing
perhaps $80.00 per day to keep in operation and turning out 400
RULES FOR SECURING MINIMUM COST. 23
yards of material per day, costing a great deal to install and after-
wards to remove, instead of a 30-ton steam shovel which might
under similar conditions do 300 yards of material at a cost of
$35.00 per day, seems rather ridiculous; yet this sort of thing
very frequently is seen.
Rule 2. — Work every element of a plant to its capacity. A
contractor's plant is usually composed of a number of elements,
or units — e. g., steam roller, traction engine, rock crusher, rock
drills, boilers, etc. The plant should be so designed and handled
as to work each of these elements to its full capacity. This may
be accomplished thus:
(a) By coordinating the elements so that each element
working to capacity keeps every other element that depends upon
it working up to its capacity.
(b) By providing extra machines to avoid delays due to
break-downs or to necessary stoppages. Thus, for every eight
rock drills in service, provide one extra drill. Also, provide an
extra wagon or two when loading by hand on short hauls.
(c) By providing extra parts of machines and means for
rapidly replacing worn or broken parts. It is not the cost of
repairs that is usually an expensive item per unit of product, but
fhe lost time of the entire plant and the working force.
(d) By giving each machine as uniform a *ioad" as pos-
sible, no "peak loads." If a machine is designed to provide for
intermittent periods of heavy work, there is a great w'aste of
interest and depreciation on the investment in the excess power
capacity during the periods of normal exertion. Moreover, the
machine subject to ''peak loads" is heavier than one not thus
subject to periods of extreme work, and is consequently more
costly to transport, install and shift, which is not important in
manufacturing but is very important in contracting.
(e) By giving the operating tool of the machine a rotary
motion., if possible, instead of a reciprocating motion. This is a
corrolary of (d), for a rotary tool is generally constantly at work.
Thus, a rotary auger should be used in all fireclays and soft
shales instead of the ordinary reciprocating or percussion drill,
for the constant application of the power to the rotary cutting
tool puts no pulsating or ''peak loads" on the machine.
(f) By providing stock piles large enough to tide over
24
COST KEEPING.
irregularities in delivery of materials. This is of exceeding im-
portance on contract work, but is usually given scant considera-
tion.
(g) By having one or more men at the manufacturing
plant, stone quarry, or sand pit, from which the important mate-
rials are being purchased. In no other way is it possible to get
uniform delivery of materials by rail from points distant from
the site of the contract work. Often it pays to have a man whose
sole duty it is to get empty cars from the railways and to go to
freight yards and see that loaded cars are not held at the yard.
(h) By having, if necessary, an extra man or two on hand,
and idle a good part of the time, who can jump in and clear away
any material or obstacle that is blocking the full operation of the
plant. A particular instance of this occurred some time ago on
some steam shovel rock work in which .considerable drilling had
to be done in front of the shovel. As soon as the shovel stopped
working it was necessary to get drills going immediately in order
that the shovels should be idle as short a time as possible ; and it
was found highly economical to have a drill crew handy so that
they could at once be turned over to the work in front of the
shovel. Their time was economized, of course, to some extent
by having them ordinarily work as near the shovel as possible
and calling them by whistle signal as soon as a shovel was
blocked.
(i) By not having in service plant which is ordinarily
capable of much more work than it is likely to be called upon to
do. The most efficient way to work a dynamo or a boiler or a
steam shovel is to work it to its regular capacity, and when it is
working at less than this it is not as economical of fuel, of capital
charges, or of the wages of the men who handle it as when its
work is properly balanced.
Rule 3.— Reduce the cost of attending machines even at the
expense of a large increase in plant charges. This may be done :
(a) By using as much power as one man can direct, with-
out unduly increasing the weight of plant to be shifted. Thus, a
6-horse team driven by one man, so commonly seen in the West,
greatly reduced the cost of operating the common transporting
machine, the wagon. If each horse can pull one ton, in addition
to the weight of the wagon, we have :
RULES FOR SECURING MINIMUM COST. 25
Per day. Per cent.
2 horses at $1.00 $2.00 57.1
1 man at $1.50 1.50 42.9
Total, 20 ton miles at 17y2c $3.50 100.0
6 horses at $1.00 $6.00 80.0
1 man at $1.50 1.50 20.0
Total, 60 ton miles at U^^ic $7.50 100.0
(b) By having- one man attend two or more machines, as
when one driver attends several one-horse carts in a quarry or on
excavation.
(c) By using gasoHne instead of steam, so as to dispense
with a fireman.
(d) By using a central power generating plant, conveying
the steam, air or electricity to the operating units.
(e) By using belt conveyors for short hauls.
(f) By using moving water to transport earth, sand or
gravel in pipes or flumes.
(g) By concentrating the work where power can be ap-
plied at a few points. This is wtII exemplified in the use of a
contractor's double track railway operated both ways by gravity,
with an incHne at one end having a power driven endless chain
for raising the single cars. In this way the cars travel both
ways by gravity without attendants. Gravity is especially adapted
to short hauls on contract work, where, either by building a light
trestle or by digging a trench on an incline, the necessary grade
can be secured cheaply.
(h) By use of power in the driving parts of a plant ordi-
narily driven by hand — e. g., bull-wheel on a derrick — thus ena-
bling the engineman to do not only the hoisting but the swinging
of the boom.
(i) Often by the purchase of electric power and use of
motors, thus avoiding the cost of handling fuel, and paying fire-
men, to say nothing of the cost of shifting boilers.
(j) By specializing the w^ork of attendance, such as the
delivery of material and supplies, which ought to be done as a
special department by itself. When a drill runner has to run to
the blacksmith shop for sharp bits or oil, the cost of attendance
upon the plant becomes unnecessarily high. By having someone
whose business it is to see that the high priced men spend little
t
26 COST KEEPING.
time waiting upon themselves, the economy can be much im-
proved.
Rule 4. — Transport and handle pieces in groups, each group
being the unit handled. This is, perhaps, one of the most impor-
tant rules for economic construction, and is susceptible of wide
application. The following are some examples:.
(a) Brick handled in packets as described in Gilbreth's
"Brick Laying System." This method of handling bricks is to
load 16 or 17 bricks upon a little wooden frame made of four
pieces of wood nailed together and of such shape that they can
be carried by the workmen as a convenient load. These 17 bricks
will weigh about 76 pounds and make a packet which is of
convenient weight for one man to handle economically where the
carry is comparatively short. Mr. Gilbreth's method is to load
the bricks upon the packets in the car on which they are deliv-
ered to the work, or even in the loading yard, and to handle them
in units in this manner until they are deposited about 21 inches
from the wall alongside of the brick layer in such a position that
he reaches for every brick with his left hand in the same manner
and in the same relative position, thus avoiding the necessity of
mental work on the part of the brick layer in choosing one brick
after another, enabling a comparatively large number of packets
to be handled upon a wheelbarrow, and eliminating the element
involved in the picking and choosing done by the man who is
loading a hod. Incidentally, when handling a hod, a hod-carrier
must do considerably more foot-pounds of work than are neces-
sary, and this accounts for something in the long run of a day's
work.
(b) Quarried stone handled in skips, from the time it leaves
the quarry until it reaches the rock crusher or the mason.
(c) Dump wagon box loaded with sand in a pit, lifted by
a derrick and placed upon the wagon gear, lifted by a derrick at
the concrete mixer and dumped into sand bin.
(d) Forms for concrete built in movable units — e. g., sewer
and tunnel lining centers.
(e) Girders for bridges and roofs, transported and handled
as one piece.
(f) Bents for trestles, framed and joined while lying flat
on the ground, and then placed in position as one unit.
RULES FOR SECURING MINIMUM COST. 27
(g) A further illustration is in the riveting together of as
many bridge members as can be carried upon a car or combina-
tion of cars for transportation and which can be erected as a
unit. Appreciation of this fact has led to the general use of plate
girders wherever possible, since the erecting costs are low and by
far the greater part of the riveting work can be done in the shop
under the most favorable conditions for economic work.
Rule 5. — Make the sum of the items of zi'ork, measured in
foot-pounds, a minimum. This rule is axiomatic, but, in spite of
its self-evidence, it is rarely applied to all parts of a job. Work
equals resistance in pounds multiplied by distance moved in feet
(W = R X D). Obviously, then, one of the first applications of
this rule is :
(a) Reduce the distance from a machine to the center of
gravity of the materials in the adjacent stock piles to a minimum.
Thus, the broken stone stock piles should be placed nearest the
concrete mixer, the sand next, and the cement farthest. The
reverse is usually done, although there are six times as many
pounds of stone as of cement in a yard of concrete. Engineers
have often made this sort of blunder when designing cableways
for transporting materials from scows, so that the broken stone
was to be moved about tw^ce as far as the sand, and the cement
was moved the shortest distance of all.
(b) By motion study and second-hand timing, eliminate
unnecessary motions and shorten the distance of necessary mo-
tions— e. g., low wagon boxes loaded by hand (2 ft. of height
saved may add 10% to man's output).
(c) Reduce the resistance:
I. By using rollers and wheels for transporting — e. g.,
"dolley" for transporting lumber instead of carrying it; (2) by
using runways, roads and tracks; (3) by balancing the dead load
of buckets and skips, so that journal friction is substituted for a
dead lift against gravity.
Rule 6. — Consider the animal body, zvhether of a man or a
horse, as a machine burning a limited amount of fuel daily, in
the form of food, and therefore haznng a limited daily capacity
for work. A horse walking at a speed of 220 ft. per minute, or
25/2 miles per hour, can exert a steady pull of 10% of its own
weight for 10 hours. For a horse weighing 1,200 lbs. this means
15,840,000 ft. lbs. of work daily, in addition to the work of rais-
28 COST KEEPING.
ing its own body every time it takes a step. A man weighing
150 lbs. can exert a steady pull of 5% of his own weight, or 7^
lbs. at 220 ft. per minute, which amounts to 990,000 ft. lbs.
per day, in addition to the work of raising his own body every
step, which amounts to another 1,000,000 ft. lbs.
When this rule (six) is observed, the contractor will :
(a) Feed the workmen, as well as the horses, with abun-
dance of nourishing food. On the Panama Canal the Jamaica
negroes were at first regarded as being almost worthless as
workers. Later it was found that the trouble lay largely in the
poor food to which they were accustomed, and proper feeding
greatly increased their output.
(b) Either house the workmen near the work, or transport
them to the work, thus saving every foot pound of energy for
useful work.
(c) Teach workmen to use the heavy leg muscles instead
of the arm and back muscles in lifting, shoveling, etc.
(d) Do not let the workman carry loads, if avoidable,
for half his available energy is then consumed in the lifting of his
own body (1/7 ft. each step) when walking. On timber work,
men are often seen carrying heavy timber with *1ug hooks" or on
their shoulders, where they should be pushing the. timber on a
''dolley" (a roller with a small platform on it) over run-planks.
Hod carrying up a ladder should give place to lifting the loaded
hod by a handpower elevator, if the size of the work does not
justify a power elevator.
(e) Remember that at $1.50 a day for labor, and 1,000,000
ft. lbs. of useful work performed, the cost is $1.50 per million
foot pounds. That at $1.00 a day for a horse plus $0.75 for the
services of a driver and 16,000,000 ft. lbs. performed, the cost is
II cts. per million foot pounds or 1/14 the cost of man work.
Hence horse power should be substituted for man power wher-
ever possible.
(f) Select heavy men where heavy work is required, as in
feeding a stone crusher whose output depends largely upon the
strength of the men feeding it, for muscular strength is usually
a function of weight.
(g) Use only heavy draft horses or heavy mules. A 1,600-
Ib. horse will do 33% more work than a 1,200-lb. horse, hence
RULES FOR SECURING MINIMUM COST.
29
a team of i,6oo-lb. horses will do 66% more work, yet with no
increased expense for driving.
Rule 7. — Use lozv-priced men to do all ivork involving merely
foot-pounds of energy.
(a) Don't let carpenters at 35 cts. an hour carry lumber
that a 15-ct. man can carry as well.
(b) Have laborers clear away earth, loose rock, etc., over
each proposed drill hole, instead of permitting drillers to do so.
(c) Plan the layout of work in such a way that the high-
priced men have not only to move the shortest possible distance in
order to handle their tools and materials, but arrange the .direc-
tion of this motion so that as far as possible it may be down grade.
Thus, have the bricklayers' helpers so place bricks for the brick-
layers that, when the bricklayer grasps the brick, instead of
raising it to its position upon the wall, he moves it either hori-
zontally or down grade. The amount of fatigue incidental to the
moving of one brick weighing 4^ lbs. is almost inappreciable,
but, when a man is laying as many as 3,000 bricks a day, the
difference between raising it 2 ft. and bringing it down i ft. is
over 25,000 ft. lbs., which makes a big difference in the total
fatigue of the bricklayer.
Rule 8. — Resolve each class of construction into the ele-
ments of work involved and study means of reducing the foot
pounds of each element.
(a) Shoveling involves: (i) Penetrating the mass,
(2) elevating the material, and (3) moving it horizontally (over-
coming the inertia of the shovel and the mass). By shoveling
off an iron plate, the work of item (i) is greatly reduced, espe-
cially where the material is broken stone. By loading into skips,
or very low wagons or cars, item (2) is reduced, or it may be
largely eliminated by caving the earth from a breast directly into
a bucket or skip.
Rule 9. — Ascertain the percentage of dead work done in
conveying and elevating material, with a virza to determining its
relative importance and thus deciding upon what it is worth to
reduce it. In all conveying, the work of moving the conveyor
itself is "dead work." Thus, a wagon weighing i ton is used
to transport 3 tons of load; therefore 25% of the work of trans-
portation is "dead work." A shoveler uses a shovel weighing
30 COST KEEPING.
5 or 6 pounds to shovel 15 or 20 pounds of earth, and thus per-
forms 25% of "dead work" so far as elevating and transport-
ing the earth is concerned. It might well pay, therefore, to sub-
stitute a higher-priced shovel made of aluminum, so as to secure
a much lighter shovel that would reduce the "dead work."
Rule 10. — Express all items of cost as percentages of the
total, to ascertain the relative economic importance of each item
and thus determine where it is best to make the first efforts of
cost reduction. Following this rule will frequently disclose as-
tonishingly high percentage costs of items that seemed normal.
Thus, foremanship expenses are often 10 to 15% of the total
cost, where they could be cut in two by using larger working
forces, by not working in winter weather when there is much
lost time, etc.
Rule II. — Express the value of all lost time in percentages of
the total cost of each part of the work, classifying the various
items. Such a classification should show:
(a) Time lost waiting for supplies or materials.
(b) Time lost waiting for other parts of the plant.
(c) Time lost shifting the plant.
(d) Time lost by breakdowns (which may also be classi-
fied).
Rule 12. — In selecting plant consider particularly the unit
cost of moving and shifting it and the cost of lost time. Con-
tracting is really manufacturing with a plant that is moved either
continuously or intermittently. Too much emphasis cannot be
laid upon the necessity of studying the costs of moving the plant
by ordinary methods, and the devising of less expensive methods.
The unit cost of transporting by means of a cableway is
usually greater than by a railway, but the unit cost of installing
and shifting the cableway is often much less. Bear in mind that
a plant of large capacity often is least economic, because of the
large unit cost of installing and shifting it. The unit cost of
plant erecting and shifting may be reduced in many ways :
(a) By mounting it on a traveler, as when several rock
drills are mounted on a traveler on wheels. This is often done
in tunnel work, and could be frequently adopted to advantage on
open cut work.
RULES FOR SECURING MINIMUM COST. 31
(b) By the use of light derricks or gin poles for erecting
heavier derricks.
(c) By using guy-derricks instead of stiff-leg derricks.
(d) By using "locomotive cranes."
(e) By a light one-rail track fastened to the side of a steam
shovel, and provided with a trolley for carrying the sections of
steam shovel track from rear to front.
Rule 13. — Make all designs for zvork, whether permanent or
temporary, in the office as far as possible, instead of leaving this
to the ingenuity of foreman or carpenters, to he done in the field.
Carpenters and foremen almost invariably use factors of safety
that are unnecessarily large for posts, and often are altogether
too small for beams. Moreover, their fastenings and joints are
usually disproportionately weak. Hence they produce temporary
structures that are much too heavy in most of the parts, and
often dangerously weak in others. The "old hand at the busi-
ness," as such men always claim to be, is often pretty much of an
old fool when it comes to designing structures to resist stresses.
On the other hand, the young engineer is apt to use too large a
factor of safety throughout for temporary structures, particular-
ly those of wood. The large factors of safety for timber recom-
mended in bridge books are intended in part to cover subsequent
weakening by incipient rot. Bins, forms, platforms, etc., that
are to be moved frequently, should be bolted together, instead of
spiked. Timbers can often be so fastened together, and left in
full lengths without framing, as to be marketable after being used
as falsework.
Where many moves are to be made, steel is frequently
cheaper than timber in the long run, for it is less injured and
shows a higher salvage value, e. g., steel sheet piling, steel cen-
tering, etc.
Scaffolding may be largely reduced in cost by supporting
such scaffolding as is necessary from the partly finished structure.
This is well illustrated in the American method of erecting apart-
ment houses and office buildings.
Falsework may often be done away with entirely by the use
of a traveler, e. g., the method of erecting steel viaducts with a
traveler.
32 COST KEEPING.
. Rule 14. — Keep down the ratio of overhead charges to di-
rect charges by night shift work. A large and expensive organ-
ization which is occupied in running a small job is a great bur-
den upon the unit efficiency of work. To remedy this the usual
method employed by contractors is to try to carry as many con-
tracts as they can. In lieu of this when it is not feasible to get
many contracts the ones on hand should be pushed at their utmost
speed consistent with economy of operation. Sometimes this will
involve working night shifts. On most steam shovel work night
shifting is from 10 to 20% more expensive than day work as far
as the direct labor charges are concerned, but this expedient
enables the whole work to proceed faster, and aside from keep-
ing down the percentage of overhead items it reduces the inter-
est and depreciation charges on plant. Where the overhead
charges are large, or when much expensive plant is being util-
ized, it is generally advisable to work double shifts excepting in
very severe weather.
Rule 15. — Use every possible means to avoid accidents to
plant by proper inspection and study of precautionary measures.
It is possible to make out an insurance policy against suits
brought by men who are accidentally injured upon the work, but
it is not possible to obtain an insurance policy protecting the con-
tractor from the economic disadvantages resulting from acci-
dental interruptions to the smooth progress of the work. . The
fall of a derrick may injure a man and the contractor be relieved
from legal responsibility by the insurance company, but nothing
relieves him of the loss in the efficiency of his work incidental to
getting a derrick repaired and set up again, to say nothing of the
discouraging effect of an accident upon all the workmen.
One of the commonest causes of delay to such operations as
those involved in steam shovel work is the derailment of cars.
This can best be guarded against by keeping the tracks in good
line and surface, and by seeing that the cars are regularly in-
spected so that defects in the coupling or running equipment are
speedily detected and repaired.
Where steam drills are running, breaks in the pressure sup-
ply pipe are to be looked for, and in freezing weather general
bursting of pipes must be carefully guarded against as one of
RULES FOR SECURING MINIMUM COST.
33
the most expensive things on the job. The pipes should be pro-
tected by lagging, burying in trenches, manure troughs, etc., and
in addition to this many of them must be regularly drained at
night. Carelessness in this particular is so common on the part
of the average men on the work that the best method known to
us is to organize a regular pipe gang whose business it is to see
that pipes are kept open, and who are responsible for delays of
this kind.
The break down of a flue in a steam boiler can come over-
night through careless firing on the part of the watchman. The
discharge of the watchman is small compensation for the damage
that occurs as a result of it.
Rule i6. — Do the most profitable part of the work first
zvherever possible, so as to avoid carrying interest charges. For
illustration we will take an example based on an actual experi-
ence, names and figures being assumed:
Contractor Jones had a capital of $15,000.00 and obtained a
contract for $145,000 worth of earth and rock work. His esti-
mate of cost was as follows :
Earth, 140,000 yards at 3oc (including 4c profit) $ 49,000.00
Rock, 120,000 yards at 80c (including 9c profit) 96,000.00
Total contract $145,000.00
Estimated profit —
140,000 yards at 4c $ 5,600.00
120,000 yards rock at 9c 10,800.00
Total $16,400.00
or 11 3-10% on the whole amount.
The contract was for "unclassified'' work ; there was no dis-
crimination made between rock and earth, but because he had
been very friendly with the engineers who made the original sur-
vey Jones felt that he was safe in trusting to the figures. The
contract simply provided that for doing 260,000 yards of excava-
tion Jones was to receive the total sum of $145,000, payable in
monthly installments as the work progressed, 10% to be retained
until the completion of the work. The plan of campaign, which
is the subject of this discussion, was as follows:
The earth was to be done first, and would yield the follow-
ing results:
34 COST KEEPING.
140,000 yards earth at 55.769c, contract price $78,077.00
Ten per cent retained until completion 7,807.70
Balance to be paid as work progressed $70,269.30
Actual cost (estimated) 140,000 at 31c 43,400.00
Balance available for running expenses $26,869.30
Then the rock was to be done, amounting to
120,000 yards rock at 55.77c $66,923.00
Ten per cent until completion 6,692.30
Balance to be paid as work progressed $60,230.70
Actual cost, estimated, 120,000 at 71c 85,200.00
Deficit on the rock $24,969.30
Balance available on the earth work 26,869.30
Difference for leeway 1,900.00
Total of amounts retained 14,500.00
Total profit $16,400.00
The work thus would ^^carry itself" except for the first
month, supplies could be paid for on 30 days, a plant costing
$20,000.00 could be paid for on 90 days, and the money borrowed
to pay three-quarters of this amount. On completion of the work
the plant could be sold for a fourth of what it cost, and thus it
was figured that a cash capital of $15,000.00 would be ample.
What happened was this: When the time came to start on the
earth-work there was no drainage, and no one thought of using
a centrifugal pump in the shovel pit. It was then decided to get
into the rock work first, borrowing some more money if neces-
sary and do at least % of the rock work before starting the
earth, then to do them both together. It works out as follows :
50,000 yards rock at 55.769c $27,884.50
Ten per cent retained 2,788.45
Balance available $25,096.05
Actual cost (estimated) 50,000 at 71c 35,500.00
Deficit on which interest must be paid $10,403.95
When he had about 19% of his contract finished he was
saddled with a fixed charge of 6% on $10,403.95, or $624.24
per year. With extensions the working time was five years, or
four years on which he was paying the above interest, and more-
over, once having started the rock work, it would have been ex-
pensive to drop it, so it was continued, the deficit and interest
charges growing. The engineer in charge happened to be strictly
honest and honestly strict, and would not budge an inch from
RULES FOR SECURING MINIMUM COST.
35
the specifications. The surface of some of the rock work had to
be *'sand-papered," no latitude was allowed in regard to making
waste heaps. If blasting did not go beyond the clearance plane
the corners had to be knocked off, while if the blasting did go
beyond the clearance plane the extra amount was not paid for.
Before Jones took hold of the contract he had interested some
strong financial people with him, more money was raised, and
the work went on, at a loss and a big one, pushed to save the
financial reputation of all the parties and because it was cheaper
to go on at a loss than to default on a bond.
Rule 17. — Do as much work as possible in a yard or shop
instead of in the field. We have already touched upon this mat-
ter in Rule 4 (g). Where economic means of transportation
exist, and particularly where the work is of any considerable
magnitude, but spread over a large area, it is usually desirable
to do as much of the manufacturing of a structure in a shop or
yard as possible. In this manner the plant loses no time from
being shifted, and, since the expense of shifting is eliminated,
a heavier plant with a larger daily output can be operated.
In building small reinforced concrete culverts, we have
found it most economic to make the floor, side walls and cover in
a yard instead of on the site where the culvert is to be erected.
Timber structures can usually be framed at a very low cost
in a small yard equipped with power saws, augers, and plant for
handling timbers. Hence where there is much falsework to
erect, either install such a plant, or have the framing done at
a mill.
A cheap roof of boards covered with tar paper can be
placed over a small yard and thus enable the work of framing,
riveting, stone cutting, concrete slab making, etc., to go on with-
out interruptions from the weather. Considering the slight cost of
such roofs, it is surprising how seldom contractors build them.
CHAPTER III.
PIECE RATE, BONUS, AND OTHER SYSTEMS OF
PAYMENT.
The fundamental law of management involves that payment
for work done shall be proportionate to performance — that is, an
increased number of units of work done by a man shall result in
his receiving increased pay. The ordinary wage system is based
upon this law, but only in a very crude manner, since it throws
men into large groups or classes, individuals of which receive
the same pay, or practically so.
We shall now consider some of the various methods that
aim to recompense a workman in proportion to his performance.
Profit Sharing. — According to the method of profit shar-
ing, each individual receives not only his wage but a pro rata
of any profits that arise from the business. Either quarterly,
semi-annually, or annually, the profits of the business are esti-
mated, and a certain percentage of these profits is distributed to
the workmen and their managers. Often this distribution of
profits is confined to the managers only.
While this is an improvement over the wage system, it vio-
lates the eighth law of management — namely, the law of prompt
reward. The imagination of the ordinary workman is not enough
to maintain his interest in his work at the high pitch necessary
to enable him to do his very best. Moreover, any community
interest in a commercial enterprise lacks sufficient stimulus. It
requires a more direct, personal interest in the outcome to arouse
a man to action.
Profit sharing, whether by the payment of profits direct, or
in the form of dividends on stock held by the workman, is, at
best, only a moderate step in advance of the ordinary wage
system so far as the average workman is concerned.
Piece Rate System. — According to the piece rate system,
each workman is paid a certain stipulated amount per unit of
work done by him. If all managers were fair in their dealings
with workmen, and if all workmen were reasonable, the piece
36
PIECE RATE, BONUS— OTHER PAYMENT SYSTEMS. 37
rate system would be almost ideal as a method of paying men
wherever the work is of a character that admits of measuring
individual performance. Due to hoggishness on the part of
managers and unreasonableness on the part of workmen, the
piece rate system usually fails to accomplish the desired end.
Having established a piece rate of, say, 10 cents per cubic
yard for shoveling earth into wagons, on the assumption that
15 cubic yards per day per man is a fair output, it requires more
than ordinary foresight and liberality not to cut the rate when
laborers begin to load 25 cubic yards a day. The typical con-
tractor will then begin to reason about as follows: "These men
have been soldiering on me in the past. I always thought so;
now I know it. Well, now that I do know it, and they know
I know it, they will have to work at this rate hereafter or get out.
What's more, I am not going to be gouged out of an extra dollar
a day, either. If they make 25 cents extra a day, it's more than
they ever got before, and it's all they are entitled to, so we will
just drop that lo-cent rate down to 7 cents. That will satisfy
them." But the trouble is that it doesn't. The men immediately
become angry, and rightly so. If they do not quit entirely, they
lose all further ambition and desire to increase their output,
knowing full well that the piece rate will be so cut as to enable
them to earn only a slight advance over their original day's
wages.
This experience has been so general that nearly all labor
unions have put a ban on the piece rate system. Bear in mind,
however, that the piece rate system is not inherently at fault,
and that it is used with great success in many places where the
management has been liberal and far-sighted.
On piece rate work that involves the use of machinery, it is
manifest that any improvement in the machinery which enables
the men to turn out more units daily, should be accompanied by
some reduction in the piece rate. Workmen, however, are usually
unreasonable and oppose any reduction in the rate. This unrea-
sonableness disgusts the manager as much as a manager's hog-
gishness disgusts the workmen. If the manager goes to the
expense of buying and operating improved machinery, he is
entitled to his share of the increased profit, but the workman is
not quick to see things in that light.
38
COST KEEPING.
Obviously, any piece rate system is productive of more or
less friction between managers and men, yet no system is free
from some friction. Probably the chief function of the labor
unions of the future will be to protect workmen in agreements
with managers, and to be parties in arriving at what those
agreements shall be.
The Bonus System. — This system involves paying each
workman a daily wage plus a piece rate on each unit in excess
of a stipulated minimum. This piece rate on excess product is
called a bonus. For example, a laborer receives $1.50 a day for
shoveling earth, and on each cubic yard in excess of 15 cubic
yards shoveled per day he receives a bonus of 7 cents. If he
shovels 25 cubic yards, he receives $1.50+ (0.07X10) =$2.20.
The bonus system is really a piece rate system with a guar-
antee of a certain minimum wage. Slight though this difference
from the piece rate system is, it is generally viewed with more
favor by workmen.
The Differential Piece Rate System. — The principle of this
system is to pay a certain piece rate up to a certain output per
man, and a higher rate (but still a piece rate) above that output.
Applied to drilling, for example, the drill runner would be paid,
say, 6 cents a foot up to a performance of 50 feet per day, and 8
cents a foot for every foot above 50. The helper might still be
paid $2 a day straight, but it is wise always to give him also a
contingent interest in the result of his work.
This system, which was devised by Mr. Frederick W. Tay-
lor, is described in the following paragraphs.
General Plans on Which the Taylor Differential Piece
Rate System Is Based. — There are two fundamental assump-
tions on which the layout of any extensive system of labor must
be predicated :
I. A man can do his theoretical best if continually in-
structed and coached, but not otherwise.
II. A man will do his theoretical best if adequately remu-
nerated, and not otherwise.
It is assumed in the expression of "theoretical best" that
the right kind of theory is meant. A theoretical best that is
founded on a lost theory is not here considered. The application
of these assumptions depends upon the following fundamental
principles of practice as outlined by Mr. Taylor :
PIECE RATE, BONUS— OTHER PAYMENT SYSTEMS. 39
1. A large daily task that must not be impossible.
2. Standard conditions, so that work can be accomplished
with certainty.
3. High pay for success.
4. Loss in case of failure.
5. The task set must be so difficult ultimately that none
but a first-class man can do it.
The first of these principles is based upon the fact of obser-
vation that if you give a man a specific thing to do in a definite
amount of time he will do it more efficiently and more accurately
than if you give him the same thing to do and he is supposed to
take "any old time" to do it. This fact is so old and is so thor-
oughly grafted upon the minds of all men who do work that it
seems unnecessary to argue in its favor; that it has not been
more generally applied is due to the lack of appreciation of how
easy it is to apply it. Hence, the rare and useful corrollary to
this proposition — namely, that the duration of a special task, for
the maximum efficiency, will be so short that a man can keep
his mind continually concentrated upon the speed with which he
is progressing, without becoming mentally exhausted. In prac-
tice it is sometimes possible to apply this principle without actu-
ally knowing what a reasonable task is by taking two men of
about equal capacity and setting them to do the same kind of
work in competition ; then the task that each man has is to beat
the other fellow, which, if he is gifted with ordinary red blood,
he proceeds to do. In the course of a comparatively short time
he finds out whether he can beat him, or not, and as soon as it
is definitely settled which man can beat the other they both stop
trying. It is possible, before they get through competing, to
determine how fast they have been working, which is the really
valuable point about competition.
Another method for ascertaining a man's possible output,
and one which is mostly used in shop work, is to divide up the
time of any process into its component parts. The process of
rock drilling, for example, can be divided into the following
component parts, starting with the drill all set up and ready for
work:
1. Turning on the steam.
2. Drilling to the limit of the first bit.
40 COST KEEPING.
3. Turning off the steam and picking up wrench.
4. Loosening the bit in the chuck, involving the unscrew-
ing of two nuts and the turning of the chuck.
5. The raising of the chuck by hand to release the bit,
assisted by the helper, who during the rest of the process is
winding up on the feed screw.
6. Drawing out the steel from the hole.
7. Laying the steel down and picking up the pump.
8. Pumping out the hole.
9. Laying down the pump.
10. Picking up the next bit.
11. Dropping down into the hole.
12. Raising piston and slipping over the head of bit.
13. Picking up wrench.
14. Tightening nuts, involving >^. revolution of the piston
about its axis.
15. Dropping wrench and turning on steam for the first
five strokes.
16. Opening up throttle and slowly working drill up to full
speed.
By the use of a stop watch a standard time for each of these
processes, depending upon the conditions, can be obtained, and
the total time, being the sum of these, will represent the entire
cycle of the process. The problem consists in adding together
the fastest times for each element to get the fastest possible time
for the whole cycle. The results from such an investigation
have never failed to be astonishing in the last degree.
1. In the process in which the mental effort required is
large, care must be taken to allow a man a sufficiency of rest.
For example, a man can "chin himself" on a horizontal bar quite
rapidly for about ten revolutions, so to speak, but the next ten are
a different matter.
2. The success of the Taylor method depends very largely
upon standardizing conditions. To use the illustration of drill
work, the time required to pick up and place in position a drill
bit four feet long is considerably less than the time required to
pick up and place in position a drill bit ten feet long, and the
performance with the ten-foot bit cannot be accurately predicted
upon observation with a four-foot bit. To use a still more
pointed illustration, the time required to drill down two feet
PIECE RATE, BONUS— OTHER PAYMENT SYSTEMS. 41
through the different kinds of rocks varies greatly, and it also
varies greatly in some of the rocks when a water jet is used.
From the above it seems clear that the precise conditions should
be known in all cases. Some of the conditions will be common
to all similar classes of work and other conditions will depend
upon the local features. The two illustrations mentioned in the
paragraph above are taken from two different classes of condi-
tions. The study of one means the study of ^drill work in gen-
eral ; the study of the other means the study of the work on the
particular job to be attacked.
3. If a man is going to take orders and alter his way of
doing work, doing it in a manner that is not only new but at first
disagreeable, and when, involved with this, he is required to per-
form what seem to him a lot of unnecessary and rather ridiculous
"stunts," he has got to have extra pay; if in addition to these
other things he is required to exert himself to the utmost the
extra pay will have to be very substantial. The whole proposi-
tion of the Taylor system is that under proper instructions with
these conditions the amount of extra work that he will be able
to do will be considerably more in proportion than the amount
of the extra pay. The amount of extra pay that he must receive
in order to do his best is from 30 to 100% more than what he
originally was getting. There is a certain point at which still
more pay will not result in the accomplishment of a correspond-
ing increase in work for two reasons : In the first place, there is
a limit to what a man can do, and in the second place, if his
money comes too easily or he gets too much of it, he becomes
lazy. Just here it is proper to observe that the result of work
of this kind is to make a man more sober as well as more indus-
trious for two reasons : He cannot drink much and hold the pace,
and the effort and attention required to get his work done de-
crease his desire for alcohol. This statement seems rather re-
markable, but it is a fact of experience.
4. If a man does not succeed in keeping up to the standard
performance, one of two situations must obtain :
a. If his lack of success is due to special conditions, lack of
instruction, lack of practice, or both, owing to break-downs of
machinery or tools, or to irregularity in the material, or to the
weather, it must not be counted against his future, but he should
himself receive less money than he would if he had succeeded.
42 COST KEEPING.
In other words he must try, and he must try successfully in order
to earn his extra money.
b. If this failure to achieve extra money is because he is
constitutionally unable to do what he ought to be able to do, then
the only thing is for him to give place to a better man. Mr.
Taylor has reduced the thing to the simple proposition of con-
sidering only two classes of labor — namely, the first-class man
and the man who is not first-class. It is not difficult to determine
which is which.
5. After months and years of development and instruction
the pay can be made so high as to attract the very finest class of
labor in the world and the task can be made so exceedingly diffi-
cult that none but the very highest class men can hold their jobs,
and at this point it would seem that the ordinary limitations of
the human machine had been reached. From a consideration of
historical facts it does not seem as if there were any limit to
what a man can accomplish industrially, but there is a limit to
what he can do physically. Further improvement must depend
upon methods, machinery, and special cooperation.
As Mr. Taylor expresses it, the differential piece rate not
only pulls a man up from the top but it pushes him equally hard
from the bottom. We quote from a paper entitled "A Piece Rate
System," read by Mr. Taylor before the American Society of
Mechanical Engineers in 1895 • **The first case in which a differ-
ential rate was applied, during the year 1884, furnishes a good
illustration of what can be accomplished by it. A standard steel
forging, many thousands of which are used each year, had for
several years been turned at the rate of from four to five per day
under the ordinary system of piece work, 50 cents per piece paid
for the work. After analyzing the job, and determining the
shortest time required to do each of the elementary operations of
which it was composed, and then summing up the total, the
writer became convinced that it was possible to turn ten pieces
a day. To finish the forgings at this rate, however, the machinists
were obliged to work at their maximum pace from morning to
night, and the lathes were run as fast as the tools would allow,
and under a heavy feed. (Ordinary tempered tools i inch by
i^ inches, made of carbon tool steel, were used for this work.)
"It will be appreciated that this was a big day's work, both
for men and machines, when it is understood that it involved
PIECE RATE, BONUS— OTHER PAYMENT SYSTEMS. 43
removing, with a single 16-inch lathe, having two saddles, an
average of more than 800 lbs. of steel chips in ten hours. In place
of the 50cent rate, that they had been paid before, they were
given 35 cents per piece when they turned them at the speed of
10 per day, and when they produced less than ten, they received
only 25 cents per piece.
"It took considerable trouble to induce the men to turn at
this high speed, since they did not at first fully appreciate that
it was the intention of the firm to allow them to earn permanently
at the rate of $3.50 per day. But from the day they first turned
ten pieces to the present time, a period of more than ten years,
the men who understood their work have scarcely failed a single
day to turn at this rate. Throughout that time until the begin-
ning of the recent fall in the scale of wages throughout the
country, the rate was not cut.
"During this whole period, the competitors of the company
never succeeded in averaging over half of this production per
lathe, although they knew and even saw what was being done at
Midvale. They, however, did not allow their men to earn over
from $2.00 to $2.50 per day, and so never even approached the
maximum output.
"The following table will show the economy of paying high
wages under the diflferential rate in doing the above job:
COST OF PRODUCTION PER LATHE PER DAY.
Ordinary System of Piecework. Differential Rate System.
Man's wages $2.50 Man's wages $3.50
Machine cost 3.37 Machine cost 3.37
Total cost per day $5.87 Total cost per day $6.87
5 pieces produced; cost per 10 pieces produced; cost per
piece 117 piece Q9
"The above result was mostly though not entirely due to the
differential rate. The superior system of managing all of the
small details of the shop counted for considerable.
"The exceedingly dull times that began in July, 1893, and
were accompanied by a great fall in prices, rendered it necessary
to lower the wages of machinists throughout the country. The
wages of the men in the Midvale Steel Works were reduced at
this time, and the change was accepted by them as fair and just.
"Throughout the works, however, the principle of the dif-
ferential rate was maintained, and was, and still is, fully appre-
ciated by both the management and men. Through some error
44 COST KEEPING.
at the time of the general reduction of wages in 1893, the differ-
ential rate on the particular job above referred to was removed,
and a straight piece-work rate of 25 cents per piece was substi-
tuted for it. The result of abandoning the differential proved
to be the best possible demonstration of its value. Under straight
piece work, the output immediately fell to between six and eight
pieces per day, and remained at this figure for several years,
although under the differential rate it had held throughout a long
term of years steadily at ten per day."
The most disappointing feature about the introduction of a
system of management modeled after the Taylor plan is that
such introduction always meets with the opposition of the "has
beens." It seems that after a man has reached a certain age
he becomes unwilling or unable to assimilate new ideas, and
when he is confronted with the proposition that he has been
doing work for 20, 25, or 30 years according to a method that
was not and is not economic, the news strikes him with a shock
that is painful. He objects, in the first place, that the new scheme
cannot be right, because if it had been right he would have known
all about it before; but, after it has been demonstrated beyond
cavil that the new scheme is right, he is likely to work himself
up into a stubborn and absolutely uncompromising policy of
obstruction. The new scheme may be all right, but it is executed
with a lot of "frills" which are not practicable; the new scheme
involves too much superintendence and too many people who get
well paid; the new ideas may have been tried out a few times
lately with success, but his old ideas have been in use for a hun-
dred years, and more people have earned their bread and butter
by the old ideas than by the new ones; finally, with his back
against the wall, having committed himself with absolute rigidity
to the proposition that the new scheme must fail, he feels that
he will stultify himself in the eyes of his employees and of his
friends if the new scheme does not fail. This all results, in the
worst cases, in a determined and absolutely uncompromising
effort to make it fail. However, so far as the authors know, it
never has failed, and it has been applied time and time again.
How to treat the obstructiveness is a matter of individual tact
and judgment that must be applied upon the merits of each case
and does not come within the scope of this volume.
The differential piece rate should never be installed until
PIECE RATE, BONUS— OTHER PAYMENT SYSTEM^. 45
after thorough time studies have been made of the work, so that
a first-class man's capacity can be predicted with accuracy.
The Differential Bonus. — This is based on the same prin-
ciple as the differential piece rate while guaranteeing to a man
a fixed minimum of wages. We have applied it in drilling work,
offering the men 2 cents per foot drilled for every foot above 70,
and 3 cents for every foot above 80 per day, while at the same
time paying them their regular rate of wages.
Task Work With a Bonus.— Mr. H. L. Gantt, one of Tay-
lor's pupils, invented a system of differential payment known as
"Task Work with a Bonus," which has been very successful in
practice and has great flexibility of application under varying
conditions. The workman under this system is paid his regular
day's wages in any event and a certain lump bonus if he succeeds
in accomplishing the standard task. The amount of this bonus is
usually about one-third of his regular wages. Mr. Taylor says
that this system is especially useful during the difficult and deli-
cate period of transition from the slow pace of ordinary day work
to the high speed which is the leading characteristic of good
management. During this period of transition in the past, a time
was always reached when a sudden leap was taken from improved
day work to some form of piece work ; and in making this jump
many good men inevitably fell and were lost from the procession.
Mr. Gantt's system bridges over this difficult stretch and enables
the workman to go smoothly and with gradually accelerating
speed from the slower pace of improved day work to the high
speed of the new system.
The Premium Plan. — This is the term used by Mr. F. A.
Halsey to describe what Mr. Taylor calls the Towne-Halsey sys-
tem. It is based on the proposition of paying a bonus for achiev-
ing an estimated performance, the means to be employed and the
methods being left to the ingenuity and initiative of the men,
rather than to the management.
Principles Governing the Fixing of a Piece Rate or Bonus.
— We are probably well within limits when we say that the average
workman engaged on construction work under the wage system
is capable of increasing his output 70% if given sufficient incen-
tive to do so, and this without the least physical injury to himself.
When it is desired to ascertain how much work men are capable
of doing, one of the best plans is to conduct a contest between two
46 COST KEEPING.
or more men, or two or more groups of men, a substantial prize
being offered for the best performance. Such a contest should
usually extend over several consecutive days, so that it will not
be a mere sprint, but a fair endurance test.
In Gillette's "Rock Excavation" are given the rate of prog-
ress and cost of driving the Croton Aqueduct tunnel. The men
in one of the headings determined to ''break the record" for one
week's run, and drove 102 lin. ft. of heading in 7 days, at a total
cost of $2.93 per cubic yard for labor, fuel, explosives and other
supplies. The average weekly progress prior to that time was
47 lin. ft. and the average cost was $5.32 in the same material.
In brief, these men doubled their average speed for a whole week
when working with an incentive, although that incentive was
merely pride in establishing a record.
Taking another example from the same book (page 360),
we find that when miners in the War Eagle Mine, at Rossland,
B. C, were paid by the lineal foot of drill hole, gangs of four
men drove 97.5 lin. ft. of "drift" (or small tunnel), as compared
with an average of 50.8 lin. ft. per month under the wage system.
Under the wage system each miner earned $3.50 a day; while
under the "hole contract system" (which is a piece rate system
with lineal foot of drill hole as the unit), each miner earns $4.25
a day. Under the wage system the mining cost to the company
was 86 cents per ton of ore, while under the "hole contract
system" it is 48 cents per ton.
These examples are cited not only to show the wonderful
possibilities of economic performance under any system whereby
the men are paid according to their output, but to indicate in a
general way what piece rate or bonus can safely be adopted to
start with.
In the last case cited, it is the opinion of the authors that the
mine managers did not give the miners as high a piece rate as
they were entitled to receive. Surely when a man doubles his
output without any change in the plant or tools, he is entitled to
an increase more than 20% in excess of his previoius income.
If a competitive contest to disclose the workmen's abilities
is not practicable, the authors assume that the output probably
can be increased 60 to 70% over the output under the wage
system, wherever the output depends mainly on the skill and
strength of the Workmen. In drilling rock, for example, if the
PIECE RATE, BONUS— OTHER PAYMENT SYSTEMS. 47
average output of each drill is 60 lin. ft. under the wage system,
then, in all likelihood, it can be increased to nearly 100 ft. under
a bonus system. The driller who receives $3.00 a day under the
wage system is really earning 5 cents for each of the 60 lin. ft.
If it is planned that he shall increase his income 50%, he will
receive $4.50 for the assumed 100 lin. ft. of hole. Hence his
piece rate would be 4>^ cents a foot, or his bonus would be $1:50
on 40 lin. ft. (60 lin. ft. being taken as the standard minimum
performance), which is equivalent to a bonus of 3^ cents per
lin. ft. on every foot in excess of 60 ft. to be added to a daily
wage of $3.00. At first sight it seems that the contractor gains
only i^ cents per lin. ft. for the 40 lin. ft. on which a bonus is
paid, or only y^ cent per lin. ft. on the entire 100 ft. The fact
is that the contractor gains much more, not even considering the
wages of the driller's helper, for the daily plant charges on the
drill remain almost constant, regardless of the output. If fuel,
fireman, interest, repairs, depreciation, foreman, etc., are $4.00
per day per drill, these fixed charges amount to 6.66 cents per
lin. ft. of hole when the output is only 60 lin. ft. a day, as com-
pared with 4 cents per lin. ft. when the output is 100 ft., or a
saving of 2.66 cents per lin. ft. Wherever a plant of any consid-
erable value is used, it is clear that it would be profitable to
double the pay of the workmen if they could double the output
of the plant, for the unit saving in plant charges alone would
amount to a handsome profit. • This is upon the assumption that
the fuel bill remains practically unchanged by the increased out-
put, and it seldom is materially affected by increased output on
contract work.
How to Fix the Wage Rate. — When a piece rate or bonus
rate is to be established it is of great importance that it be estab-
lished with correctness, so that it will not be necessary to alter
it subsequently, since nothing is likely to produce more dissatis-
faction among the men than a change of base on the part of the
management, which gives the men the impression that they are
being imposed upon. A fairly safe rule is to pay a piece rate
which will insure to the average workman under average condi-
tions with average effort the ordinary wages which he could earn
by the day. The trouble with this basis is that after the piece
rate has been in operation a little while the earnings per man
increase so much that the employer begins to think that the piece
48 COST KEEPING.
rate is too high, and then he attempts to readjust it with disas-
trous results. After long experience in this subject the only
thoroughly satisfactory method of fixing the wage rate that we
know of is to guarantee to the men not less than the "prevailing
rate of wages," and preferably a little more than the prevailing
rate of wages, as a daily or hourly or monthly rate, and on top
of this to pay them extra for extra accomplishment. To make
men do their level best, an increase of from thirty to forty per
cent of this regular wage is necessary.
Mr. Harrington Emerson developed an excellent way of
grading bonuses while reorganizing some of the work at the
Toledo shops of the Atchison, Topeka & Santa Fe Railroad in
1907. Mr. Emerson first determines what a man's theoretical
practicable efficiency is, and this he calls 100% efficiency. Thus,
if a first-class man ought to be able under the standard condi-
tions to make 100 pieces of a certain pattern per day, a man who
succeeds in making 80 is rated at an efficiency of 80%. The
bonuses are graded as follows: A man whose efficiency is 67%
receives the regular rate of wages. If his efficiency is 80% he
receives about 3^-% of the regular rate of wages as a bonus.
When his efficiency is 90% he receives a 10% bonus. At 100%
efficiency he receives 20% bonus and from then on he receives
1% additional bonus for every per cent increase in efficiency.
Thus if he can do 50% more work than the standard man or if
his efficiency be 150% he gets 70% bonus.
It is well to avoid starting oflf on any fixed piece rate in
outside construction work, as thereby it is possible to steer clear
of a great many obnoxious preconceived notions of the men
who may fear that the management is getting up a scheme to
deprive them of their just compensation.
In applying any rule of this kind it is important to start off,
as a rule, with one man, or small group of men, at a time, gradu-
ally expanding the system to include the whole job. Don't forget
that the expansion must absolutely be gradual and at first very
slow.
The "Stint" System. — Having decided the number of units
of output that may be accomplished in a day or in a week, a
"stint" or task may be assigned to an individual or to a gang,
with the promise that when the "stint" is performed the work-
men will be reguired to do no more that day or that week. By
PIECE RATE, BONUS— OTHER PAYMENT SYSTEMS. 49
this method, the reward consists in a gift to the workman of all
time that he may save by working vigorously. The authors have
frequently found that a gang would finish its day's stint three
hours before the regular quitting time, or that, if the "stint"
was a week's work, the men would save i >4 to 2 full days. There
are some advantages of this method over the ordinary wage
system. For example, it gives spare time in which to make
repairs to the plant while the workmen are not using it. It makes
the men more cheerful and ambitious while working, for they
look forward eagerly to the hours thus gained for recreation.
Hence a large "stint" can be set and the men will do more units
of work under it than under the regular wage system.
The "stint" system has the obvious disadvantage that it does
not yield the workman an increased income. Therefore it is only
a short step in the right direction. We mention it in this chapter
principally because it is often a good method to adopt preparatory
to adopting a bonus system, for it serves to show, in a measure,
what the men are capable of doing, and thus acts as a guide in
deciding what the bonus shall be.
CHAPTER IV.
MEASURING THE OUTPUT OF WORKMEN.
Difficulties of Measurement. — Before men can be paid ac-
cording to their performance it obviously is necessary to devise
methods of measuring the number of units of work done, but it
is not always so obvious what units to select nor how to measure
them readily after the selection of units has been made. Indeed,
this difficulty accounts in large part for the slowness with which
piece rate and bonus systems have been adopted.
Subdivision of Units into Other Units. — In engineering
construction the cubic yard is a very common unit upon which
contract prices are based, but the cubic yard itself is frequently
a very uncertain unit of performance, for it is a composite of
other units. Thus, in rock excavation there are several distinct
operations involved, which may be enumerated as follows:
1. DrilHng!
2. Charging and firing (or blasting).
3. Breaking large chunks to suitable sizes.
4. Loading into cars, carts, skips, or the like.
5. Transporting.
6. Dumping.
The important item of drilling depends largely upon the
spacing of the drill holes, which varies in diflferent kinds of rock,
and in different kinds of excavation, trenches and tunnels re-
quiring close spacing. Clearly, then, the -lineal foot of drill hole
is a unit of work that must be adopted by the rock contractor in
measuring the output of his drillers, and not the cubic yard.
Transportation is largely a function of distance, hence the
unit of transportation cost should be the ton (or yard) carried
100 ft. or I mile, and not the cubic yard without the factor of
distance.
Our first rule to be applied in seeking units that truly express
the amount of work done is as follows : Dkide the contract price
units into sub-units, selecting the "foot-pound'' of work as the
sub-unit wherever possible.
50
MEASURING THE OUTPUT OF WORKMEN. 51
A foot-pound is the unit of work used in theoretical and
appHed mechanics. It is the amount of work required to Hft i
pound a height of i foot. All forms of work are capable theoret-
ically of being expressed in foot-pounds, but it is often very
difficult to do so in practice. For example, it is not an easy
matter to ascertain how many foot-pounds of work a man per-
forms in shoveling earth into a wagon, for there is not only the
number of foot-pounds involved in lifting the earth but in pushing
the shovel into the earth, in lifting the shovel, in lifting the upper
part of his own body, and in overcoming the inertia of earth,
shovel and body. However, the theoretical ideal unit is the foot-
pound, and, in selecting the actual unit to be used, the effort
should be made to secure a unit that is as closely proportional
to the foot-pound as possible. Thus, in drilling, there are certain
units of work done by the drill in pulverizing the rock in the drill
hole, and this work is quite closely represented by the number
of lineal feet of drill hole in any given kind of rock. Hence the
most practical unit of work in drilling is the foot of hole drilled.
The second point to consider in selecting suitable units of
work is the different processes involved. Each process on field
contract work usually involves a dift'erent class of men. In rock
excavation the six items above given usually involve six separate
gangs of men. Although all contribute their part to the final
contract unit upon which payment is received — the cubic yard —
yet the work of each may be, and usually is, better measured
in terms of some other unit. We already have seen that the lineal
foot of drill hole — and not the cubic yard — is the unit to select
for the drilling gang. The pound of explosive charged in the
drill holes is a good unit by which to measure the work done by
the blasting gang. The cubic yard of rock usually is the only
practical unit of breaking large rock chunks. So, too, the cubic
yard becomes the unit for loading and for dumping, whereas the
yard-mile, or ton-mile, is made the unit of transportation. Still
further subdivisions of some of these six processes are often
desirable, yielding still other units that more closely approximate
the foot-pound unit.
Therefore, our second rule is as follows : Since construction
usually is divided into processes, and since a separate gang usu-
ally performs each process, select sub-units based upon the work
done by each gang.
52
COST KEEPING.
In order to apply this rule it frequently is necessary to reor-
ganize the work so that each process is performed by its special
gang. Where the work is not of sufficient magnitude to keep
distinct gangs busy on each separate process, it is still often pos-
sible to work the same gang a few hours at one process and then
shift it to another process, instead of working the same men in
a heterogeneous fashion on two or more processes at the same
time.
Units for Concrete Work. — The cost of a cubic yard of
concrete varies between about $3.00 for cheap pavement sub-
base to about $20.00 for certain parts of a reinforced concrete
building. A hasty generalization drawn from such variations
as this has led many an engineer to scout the usefulness of
cost data, particularly such data as have not been gathered by
the individual who attempts to draw conclusions from them.
However, when the cubic yard of concrete is divided into
proper sub-units of cost, it is astonishing to note the fading
away of all seeming difficulties, either in estimating costs of
concrete or in securing data upon which to judge the
efficiency of workmen.
The labor processes in concrete may be classified as follows :
1. Receiving and storing materials.
2. Delivering materials to the mixer (loading and hauling).
3. Mixing concrete.
4. Transporting concrete.
5. Placing concrete.
6. Ramming concrete.
7. Finishing the surface.
8. Framing the lumber for forms.
9. Erecting forms.
10. Shifting and cleaning forms.
11. Taking down forms.
12. Shaping the reinforcing steel.
13. Placing the reinforcing Fteel.
Some of these processes may be still further subdivided, and
frequently it is desirable to do so. While the cubic yard of con-
crete is usually a satisfactory unit for items one to six, It is clear
that the square foot or square yard is a unit that must be used
for item 7. Items 8 to 11 should be expressed in terms of the
1,000 ft. B. M. as the unit, and it is usually desirable also to use
MEASURING THE OUTPUT OF WORKMEN. 53
the square foot of concrete surface covered by forms as an-
other unit for estimating the cost of work on forms. Items 12
and 13 should be expressed in terms of the pound of steel as the
unit, since the number of pounds of steel per cubic yard of con-
crete varies widely.
Two or More Units for the Same Class of Work. — As
just indicated, it is frequently desirable to use more than one unit
of measurement. The unit on which the contract price is based
is usually a desirable one in which to express all items of cost.
In addition to this, the cost of each item may be expressed in
other units, such, for example, as the i,030 ft. B. M. and the
square foot of area for form work in concrete construction.
Such units should be selected as will permit comparison not only
of one day's w^ork with another, but of one job with another, and
frequently it is desirable to select units that may be used in
comparing two entirely different classes of work.
Uniformity in Units of Measurement. — The economic im-
portance of uniformity in units of measurement cannot be over-
estimated. To illustrate : The common unit of concrete work is
the cubic yard, but it is customary to measure cement walks in
square feet. Now this leads to many blunders, not only in esti-
mating the cost of walks but in effecting reductions in cost. Not
only does the thickness of cement walks vary widely, but the
proportion of cement to sand in each layer of the walk is vari-
able. Therefore, to say that it takes so many barrels of cement
to make 100 sq. ft. of walk means next to nothing unless the
plans and specifications for the walk are also given. For pur-
poses of accurate estimating it is necessary to prepare tables of
cost of mortars and concretes in terms of the cubic yard ; then by
remembering that 100 sq. ft. having a thickness of i inch are
almost exactly 0.3 cu. yd., it is a simple matter to convert costs per
cubic yard into costs per square foot.
Not only in computing costs of cement walks, and the like,
but in reducing costs, does it aid us to use the cubic yard as the
unit, for it enables us to make comparisons, and thereby dis-
cover inefficiency of workers. In Gillette's "Handbook of Cost
Data" a case is cited where the labor cost of the face mortar for
a concrete wall was out of all proportion to what it should have
been. Had the contractor estimated the cost of this mortar in
cubic yards, he would have discovered that it was excessive. The
54 COST KEEPING.
labor of mixing mortar should not be much greater than the labor
of mixing concrete per cubic yard, nor should the labor of
conveying the mortar in wheelbarrows be greater. The labor of
placing it in a thin layer is obviously greater than for placing
concrete in thick layers ; but, in the case mentioned, the con-
tractor was losing his money in mixing and conveying the mortar.
He had not recognized the fact because he had not reduced the
cost to dollars per cubic yard of mortar.
In like manner, one may often see money wasted in making
and delivering mortar to bricklayers and masons, because the
cost of the mortar itself, in terms of the cubic yard of mortar
(not of masonry), has not been calculated.
The cost of labor on forms and falsework should always be
recorded in terms of i,ooo ft. B. M., as the unit; for that is the
common unit of timber work, and, being so, ready comparisons
can be made only in dollars per M. ft. B. M.
It is surprising how few managers of men have realized the
value of reducing the cost of each item of work to units that are
comparable ; and by this we mean units in terms of which entirely
different classes of work may be compared. Thus, in a brick
pavement there is grout used between the joints. This grout is
a thin cement mortar, and it averages, let us say, 6 cents. per sq.
ft. of pavement. Now, what does it average per cubic yard of
grout ? Probably not one paving contractor in a thousand knows ;
but, until he does know, he cannot compare the cost of grouting
with the cost of other kinds of cement work. Many a time have
we had our eyes opened to unsuspected losses and inefficiencies
only by reducing the costs of the elements of work to units com-
parable with the units of similar work in other fields.
The ton is a very convenient unit to use when comparing
the cost of loading and handling materials of all kinds. The
ton of brick, the ton of gravel, the ton of timber, the ton of cast-
iron pipe, are loaded upon wagons by hand at a cost differing not
so much, one from the other, as might at first be supposed.
When reliable data are not available for estimating the cost of
handling any given material, by reducing it to tons an approxi-
mate estimate can usually be made that will be satisfactory, at
any rate far more reliable than a guess.
Units of Transportation. — On contract work, distances
of transportation are usually so short that the percentage of time
MEASURING THE OUTPUT OF WORKMEN. 55
"lost" by cars, carts, etc., while being loaded, becomes a very
large part of the total day's time. Hence the unit of transporta-
tion must not be simply a unit of weight, or of volume, trans-
ported a unit distance. For example, a wagon may be loaded
with earth in 4>^minutes, transported 100 ft., dumped and re-
turned in lYz minutes, or less; total, 6 minutes. Of this time
less than 25% is spent in transporting the earth. On the other
hand, if the haul is 6,000 ft., the time spent in transporting may
be 93%. The cost per 100 ft. transported is almost four times
as much in one case as in the other. Therefore, unless the hauls
are so long that the time lost in loading and unloading is an
insignificant part of the total time, it is essential to divide the
work of transportation into three elements :
1. Time lost loading.
2. Time lost transporting.
3. Time lost unloading.
Often this third item is so small that it may be disregarded.
On contract work it is often necessary to have a fourth item :
4. Time lost during the shifting of tracks, and other
changes in plant location.
In brief, the lost time, of whatsoever nature, must be deter-
mined and deducted from the total time, before the number of
units of transportation performance can be divided by the correct
number of hours.
Transportation, therefore, must be divided into two main
units of cost :
1. Xon-productive (lost time loading, dumping, shifting
plant, etc.).
2. Productive.
The total cost of the non-productive time is divided by the
total number of yards or tons moved to get the unit non-produc-
tive cost of transportation.
The productive cost of transportation is the ton-mile, the
cubic yard-mile, the ton-station (station = 100 ft.), or the like.
The distance of transportation is usually computed from a
map, but it is often desirable to attach an odometer to one. if not
all, of the wagons, locomotives, or the like.
Odometers of the kinds used on automobiles and bicycles
can be advantageously used in a great many places on contract
work, a few of which are as follows: On wagons, on wheel
56 COST KEEPING.
scrapers, on locomotives, on traction engines, on road rollers, on
derricks (to record the number of swings), on hoisting engines,
on cableway carriages, etc. Indeed, wherever a machine or tool
has a revolving or reciprocating part, an odometer or counter
can be used to record the number of reciprocations or revolu-
tions, and from the data so recorded the amount of work can
often be calculated with great accuracy.
Recording Single Units. — There are many classes of v^ork
in which the only practicable unit to be used is the single or
individual unit itself; thus, the telegraph pole erected, the pile
driven, the door hung, etc. Obviously records of units of this
sort are so readily made as to require almost no comment.
A punch card is a convenient record of single units. Some
contractors prefer a tally board on which each unit is marked
or tallied with a pencil. Others use a board like a cribbage
board, having holes in which plugs are put to record the number
of units. Still others give out tickets to the men for each unit
of work delivered.
Record Cards Attached to Each Piece of Work. — In doing
machine-shop work it is often necessary to have one piece of
metal pass through the hands of several different workers. For
example, one man may drill holes of a certain size, another man
may drill holes of another size, still another man may thread the
holes, and so on. In such a case it is common practice, where
careful cost records are kept, to provide a card that is attached
to each piece or each lot of pieces. In blanks provided on the
card, each worker enters his number, and the number of hours
and minutes spent by him in doing a specified kind of work on
the piece. A modified form of this method is to attach a card or
a brass check to each piece, giving a serial number and letter to
the piece. Each workman on the piece notes its number on his
own record card, and opposite this number he enters the amount
of time spent on the piece.
While this method of recording output cannot be as fre-
quently used in engineering contract work as in machine shop
work, it should not be overlooked by the general contractor. It
might well be applied to timber work where one gang of men
bores the holes, another gang saws and a third gang "daps" or
adzes the sticks, and so on. It is desirable always to assign
different kinds of work to different men, not only because the
MEASURIXG THE OUTPUT OF WORKMEN. 57
time usually lost in changing tools may be saved, but because
men become more expert when they do one class of work only.
The record card facilitates the differentiation of labor into
classes, and is, therefore, a great aid in increasmg the output of a
given number of men.
Measurements of Length. — For a great mavy kinds of con-
tract work the lineal foot is the best unit to use. Track laying,
fence building, pipe laying, setting curb, etc., come under this
head. ]^lany other classes of work are commonly measured only
in terms of the lineal foot, when, to permit of true comparisons,
some other unit or units should also be adopted. Sewer work,
for example, is commonly recorded only in terms of the lineal
foot ; but the amount of excavation varies greatly per lineal foot
in different sewers and often in the same sewer; hence the exca-
vation should be measured with the cubic yard as the unit.
Tunnel excavation should also be reduced to the cubic yard
standard. A contractor has no very definite idea whether the
"mucking'' (loading of cars) in a tunnel is being done economic-
ally or not until he has determined how many cubic yards each
man is loading daily.
iNIeasurements of length are often best made by driving a
line of stakes 100 ft. apart, calling each stake a "station." The
starting point or station is called Station o. The next station,
100 ft. from the start, is Sta. i ; the next station, 200 ft. from the
start, is Sta. 2 ; and so on. Hence the mark on any given station
stake gives the number of hundreds of feet from the starting
point. Points intermediate — that is, between any two stations —
are called "pluses." Thus, a point 40 ft. in advance of Sta. 2
is called "two plus forty," and is written Sta. 2 + 40, by which
it is clear that it is 240 ft. from the start.
Having driven a line of station stakes, properly marked with
their station number, a foreman or timekeeper can quickly ascer-
tain the station and plus at which the day's work has been
completed.
In many instances, measurements of length are best made
by counting the number of pipe lengths laid, or the number of
rail lengths.
Measurements of Area. — Paving, painting, roofing, plas-
tering, and many other classes of construction work are best
measured in terms of the square yard, square foot, or "square"
58 COST KEEPING.
(lOO sq. ft.) as the unit. Since areas are usually measured with
ease, it is noticeable that area work is generally done with much
greater economy than mass work, which is usually more difficult
to measure and consequently not measured every day on most
jobs. It is sometimes not easy to measure the number of thou-
sand feet board measure in concrete forms, in which case it may
be preferable to measure the area of concrete covered by the
forms, from which, if desired, the amount of lumber can be
calculated approximately.
Measurements of Volume. — This class of measurements
is usually the most difficult to make for purposes of daily output
reports. Excavation, for example, is not easily measured, as a
rule, except by a surveyor. Of massive masonry the same is
true. Hence there are few contractors who know accurately
how many cubic yards of this sort of work should be accredited
each day to each gang. Record should be kept of the number of
car or wagon loads of excavated material ; but, to derive much
benefit from such records, care must be taken to have cars and
wagons of uniform size uniformly loaded, or to keep record of
the capacities of the different vehicles. Where daily measure-
ments of volume are difficult to secure, some one or more of the
following methods may be adopted.
Measurements of Weight. — Loaded cars or wagons can be
weighed on track scales or on portable platform scales, rmd this
can be profitably done far oftener than it is. Loaded skips and
buckets can be weighed with spring balances attached to the
hoisting rope of a derrick. It is sometimes very difficult to
measure volumes of certain quantities in the field and it then
becomes of advantage to weigh them. It is not easy to tell how
much rock there is on a skip load without weighing the loaded
skip either by placing it on scales or by putting a spring balance
on the derrick. Spring balances of that character can be pur-
chased of a capacity up to 2,600 lbs. and costing about $150. An-
other form of rock measuring apparatus is in the nature of a
balance, costing about $115. . A great advantage of a spring bal-
ance on a derrick is that it takes no extra time for handling, and,
while the first cost seems rather high, the information obtained on
a large piece of work is well worth its cost.
In a good many of the Hudson River Trap Rock Quarries
the stone is handled in cars which are pushed along on the tracks
MEASURING THE OUTPUT OF WORKMEN. 59
for purposes of weighing and the men are paid for performance
according to the weights on the cars. This is a very accurate
and, where it is practicable, a highly satisfactory method of
measuring output.
This method has long been in use at coal mines where every
car is numbered, and is weighed before dumping.
On contract work, such as macadamizing, for example, each
wagon load may be weighed, if the amount of the work warrants
the purchase and use of platform scales. It is usually considered
sufficiently exact, however, to measure the size of a few loads,
and simply count the number of loads. However, loads often
vary so greatly in size that this method of counting loads becomes
very unsatisfactory. This holds true particularly of loads of
quarried stone, of earth loaded by steam shovels, and the like.
In such cases the contractor should seriously consider the advisa-
bility of weighing each load.
One of the most difficult classes of construction work to
measure daily is rubble masonry. Yet we have found two very
satisfactory methods of recording the work done by each derrick
gang. One way is to use wooden skips that are loaded at the
quarry with stone, put upon cars and transported to the work.
Each skip is provided with a clip for holding a brass check. The
checks are numbered serially, and the weight of stone correspond-
ing to each number is entered in a book ; for before delivery
to the masonry derricks each skip is lifted by a derrick, placed
on scales and weighed. It is sometimes preferable to provide a
large spring balance for weighing, instead of using scales. The
mason in charge of the derrick gang removes the brass check
from the skip and keeps it, entering its number on a card which
is turned over to the timekeeper at night, together with the brass
checks. Thus it is possible quickly to ascertain the number of
tons of rubble laid by each gang.
Functional Units of Measure. — Under this head w^e class
all measurements of units that are functions of the desired units.
Thus, in any given mixture of concrete, the number of barrels or
bags of cement is a function of (i. e., it bears a definite relation
to) the number of cubic yards of concrete. Hence a record of
the amount of cement used each day will enable making a close
approximation to the number of cubic yards of concrete.
6o COST KEEPING.
In rubble or cyclopean masonry, a record of the number of
buckets of mortar will enable making a close calculation of the
yardage of masonry. If spalls are liberally used to reduce the
amount of mortar, as they should be, then the number of buckets
or skips of spalls should also be recorded.
The number of gallons of paint used is ordinarily a fair
criterion of the area of surface painted.
By the use of packets for handling bricks, Gilbreth has
developed a system of measuring the work done by each brick-
layer, for count is made of the empty packets stacked up by each
mason. Since each packet is loaded with a definite number of
bricks, this gives an accurate record of each man's output.
Stockpile Measurements. — There are certain kinds of con-
struction that are best measured indirectly by ascertaining what
has been removed each day from the stock piles. Thus, in erect-
ing a frame building, the different kinds and sizes of lumber can
be piled in stock piles of regular size, easily measured. Rolls of
paper, bundles of shingles, etc., can be stored in such manner that
a daily inventory of stock on hand is readily made. By subtract-
ing the amount shown by the inventory at the end of each day
from the amount on hand the previous day, an accurate record
is obtained of materials that have gone into the building. Since
a carpenter's work is usually best measured in terms of the i,ooo
ft. B. M., the square of shingles, and the like, it is evident that
stock pile measurements can be used to great advantage in deter-
mining the number of units of certain kinds of work performed
on a building.
The measuring of material is greatly facilitated by using a
standard method of handling. Gilbreth's rule for cement (see his
''Field System") is to place the bags one on top of the other in
piles of fifty.
One of the most difficult of the materials to check regularly
is the reinforcing steel for concrete. If this is handled in plain
bars they can be weighed and wired in bundles of lOO lbs., this
being a suitable size for two men to carry. The bundles are, of
course, nearly always more or less than loo lbs., and when the
steel is wired it is a good plan to attach to each bundle a tag
giving its weight, which tag can be left with the storekeeper for
record as the bundles are removed to the work. The difficulty
of obtaining these records is caused by the fact that the material
MEASURING THE OUTPUT OF WORKMEN. 6l
is usually placed in a haphazard way wherever it happens to be
most convenient for the men placing it without any systematic
regard for its use on the work.
Key Units of Measure. — It is always desirable to relieve
the foreman or timekeeper of the work of computing the number
of units of work done daily, wherever such computation involves
either many measurements or much labor in computing. A fore-
man can readily report the number of "stations" of road graded
or macadamized, leaving to the office force the work of deducing
the number of units of work performed.
A further step in the same direction is the use of key letters
and numbers to designate sections of work whose dimensions
the foreman may not know but which are recorded in the office,
and from which the number of units of work performed can
be readily ascertained. For convenience we call these units key
units, since they are designated by key letters or numbers.
Key Units on Drawings. — Any given structure can usual-
ly be divided into "sections" identical in shape and character of
work. Thus, in a concrete building, there are a number of
columns of identical size, a number of beams also identical, a
number of identical floor slabs, and so on. To each of these
"sections" a key letter or number, or a combination letter and
number, may be assigned and written on the drawing.
If numbers from lOO to 199 are reserved for "sections" on
the first floor, and the letter C is used to denote columns, then
C 100 will designate a particular kind of column on the first floor ;
while C 200 will designate a corresponding column on the second
floor. Having assigned keys to all "sections," the foreman or
timekeeper is furnished with blueprints on which the "sections"
with their respective keys are marked. In some instances it is
preferable to furnish only a few large blueprints containing many
"sections" on each print, but it is usually desirable to supplement
these large blueprints with small ones of notebook size, which, if
preferred, can be punched and bound in a loose-leaf binder.
The foreman or timekeeper reports daily the number of each
class of "sections" built by each gang, using the proper key to
designate each "section," The office force, having computed the
number of units of work in each section, is then able to record
the total number of units of work done, with accuracy and with
rapidity. If a full "section" is not completed, the foreman or
^2 \ COST KEEPING.
timekeeper estimates the percentage completed, and reports
accordingly.
Keys Marked on Separate Members. — On certain classes
of work a modification of the above plan is preferable. Instead
of providing the foreman or timekeeper with drawings having
keyed "sections," a key number or letter is painted, or otherwise
marked, on each separate member of the structure before it is
put into place. Thus, each block of cut stone is measured in the
stock yard and a *'key" is painted upon it. Then, when the fore-
mian reports that block A 105 has been laid in the wall, the office
force can determine its volume from the recorded measurements.
The authors have found this to be the most satisfactory method
of recording cut stone work, for it is thus possible not merely
to tell the total amount laid each day by several derrick gangs
but to tell precisely what each gang has done, for each boss
mason can be required to record the key number of every stone
laid under his direction. The office work of computing the
volume of each stone is insignificant in amount if tables are used
for computation, such as Nash's "Expeditious Measurer" ($2.00).
These tables give the volume of any block, progressing in size by
inches up to 4 ft. 9 in. x 6 ft. 4 in. x i ft. i in. The tables also
give surface areas, progressing by inches, up to 4 ft. i in. x 8 ft.
5 in. in size.
Structural steel members can be marked with key letters ; so,
too, can heavy timbers, movable sections of forms and falsework,
and many other classes of materials used in construction work.
Conclusion. — Upon the ingenuity of the management en-
gineer who devises ways of recording the daily output of work
done rests the success or failure of any effort to introduce modern
methods of management on complicated contract work. The
problem before him is often one to tax his ability almost to the
elastic limit, for it is not sufficient to devise a method of meas-
uring daily output after a fashion. He must devise not only an
accurate method but one that permits of application at the hands
of men comparatively unskilled mentally, and under the varying
conditions that characterize field construction work. Many a
contractor has given up in disgust his attempt to install a modern
system of cost keeping, and has charged his failure to the folly
of "new-fangled notions." Such failures are usually the outcome
of trying to teach old dogs new tricks without so much as hiring
MEASURING THE OUTPUT OF WORKMEN. 67,
a competent teacher. Eventually, it will be recognized that man-
agement engineering- is a science not to be picked up and mastered
at one reading of any article or book, but that it requires study
extending over a considerable period of time.
CHAPTER V.
COST KEEPING.
Objects of Cost Keeping. — The two primary objects of
cost keeping are :
1. To enable a manager to analyze unit costs with a view
to securing the minimum cost possible of attainment under exist-
ing conditions.
2. To provide' data upon which to base estimates of the
probable cost of projected work.
As a result of the analysis of unit costs, followed by a com-
parison of the items with corresponding cost items of similar
work previously done, a manager may discover :
1. Excessive use of materials in erecting a given structure.
2. Excessive use of supplies (coal, etc.) m operating a
plant, whether due to ignorance, carelessness or theft.
3. Inefficiency of workmen.
4. Inefficiency of foremen.
5. Padded payrolls.
6. Excessive loss of time due to: (a) plant break-downs,
(b) plant shifting, (c) waiting for materials or supplies, etc.
7. Improper design of plant.
Cost keeping also leads to the introduction of piece-rate or
bonus systems of payment, which may, in fact, be said to be one
of the ultimate objects of cost keeping.
Cost keeping secures many incidental advantages, like the
following :
1. Fewer "bosses" are required on certain classes of work,
for the report card is a more persuasive stimulus than the eye of
a taskmaster.
2. One skilled manager can direct many more men, and
with much greater effectiveness than is possible where a cost
keeping system does not exist,
3. Systematic analysis of costs leads inevitably to a study
of reasons for differences in costs, and this study of reasons is
64
COST KEEPING. 65
the first 'step toward inventing new machines and new methods
for reducing- costs.
Cost Keeping Defined. — For the purpose of the discus-
sions in this book, a distinction must be drawn between book-
keeping and cost keeping.
Bookkeeping, as we treat it, is the process of recording
commercial transactions for the purpose of showing debits and
credits between different '^accounts." These '"accounts" may be
individuals or firms, or they may be arbitrary accounts, the latter
being an evolution in bookkeeping that came after individual
accounts became so large or so complicated as to be insufficient
to show the status of the business and the profits derived from
any given transaction.
Cost keeping, as we treat it, is the process of recording the
number of units of work and the number of units of materials
entering into the production of any given structure, or into the
performance of any given operation. To these units of work
or materials, actual or arbitrary wages or prices may or may
not be assigned. The object of cost keeping is primarily to show
the efficiency of performance ; hence actual money disbursements
need not be recorded, as in book keeping. This distinction is
vital, and will be discussed at greater length.
Differences Between Cost Keeping and Bookkeeping. —
Bookkeeping was first devised and subsequently developed by
merchants. Cost keeping was devised and developed by engi-
neers. The merchant is a student of profits : the engineer is a
student of costs. Although profits depend upon costs, there is a
vast difference in the point of view of the merchant and the
engineer.
In the study of costs, as we have previously pointed out,
the aim of the engineer is to reduce all costs to a unit basis,
selecting such units as most closely conform to the theoretical unit
of work — the foot-pound. This study often necessitates the
use of several different units for the same class of work. It
necessitates the recording of conditions, and the making of
measurements — all of which is more or less foreign to the funda-
mental idea of bookkeeping. Yet, in groping toward methods
of cost keeping, it has become the practice of most contractors,
manufacturers, railway companies, etc., to endeavor to develop
a cost keeping system in the bookkeeping department. Hence we
66 COST KEEPING.
have today systems of bookkeeping that are wonderfully complex,
and, withal, show very little that they attempt to show as to unit
costs.
Take, for example, the accounting department of an Amer-
ican railway. Here we find skilled accountants loaded up with
a mass of work called for in distributing the costs to different
accounts. Calculating machines that carry the cost of railway
spikes out to the third decimal place are clicking away from
morning to night. A prodigious amount of figuring is done so
that scores of distributions may be made, without the error of
a cent in the balancing of accounts. Yet, with it all, what do
these railway accounts show as to unit costs? Next to nothing
worthy of the name of cost keeping. The authors have in their
possession a mass of railway accounting records ; some of it of
great value, but most of it valuable only to show bookkeeping
gone mad. The accounting department of the average railway
has no true record of unit costs. The average railway engineer-
ing department is even worse off, as shown by the ridiculous
estimates often submitted. After a structure is built, the auditor
of the railway takes the superintendent of construction to ac-
count for having exceeded the engineer's estimate. The engineer
is put on the rack and calls the superintendent inefficient —
which is usually true. The superintendent retorts, in his letter
to the accounting department, that the engineer does not know
how to estimate correctly — which, also, is usually true. Figures,
figures, figures, but not a single unit cost ! This is typical of
railway accounting costs today. We emphasize it because it is
also typical of the accounting departments of many contracting
firms. And we emphasize it again because it illustrates so well
our contention that bookkeeping and cost keeping must be di-
vorced if there is to be a simple, effective system of ascertaining
the efficiency of workmen, and permit of such study of their
performance as will result in greater efficiency.
Why Cost-keeping Records Should Be Kept Distinct
From Bookkeeping Records. — Many contractors and engineers
confound cost keeping with bookkeeping and attempts are often
made to make a cost keeping system so elaborate as to be a
bookkeeping system, thus burdening the bookkeeping with a great
deal of material that is not germane to it and piling the cost
COST KEEPING. 67
keeping under an avalanche of details and figures that are
destructive to its economic value.
Bookkeeping is an ancient art. Cost keeping is a develop-
ment that is less than a generation old. Since cost keeping has
resembled bookkeeping in some respects, it has been regarded as
an evolution of bookkeeping, when, in fact, it w^as not originated
by accounts nor developed as a part of accounting. We repeat
that cost keeping has been evolved and developed by engineers,
not by bookkeepers. It is an art and a science having objects
differing radically from the objects of bookkeeping. Yet innu-
merable blunders have been made in the attempt to graft a cost
keeping system upon a bookkeeping system. These blunders
arise from a misconception of the functions of cost keeping and
bookkeeping. Let us consider still further what bookkeeping is
and wherein it differs from cost keeping.
Bookkeeping in its original and simplest form consists of a
record of debits and credits. Its primary object is to show
obligations between individuals or corporations. By an extension
of this idea, arbitrary accounts were created, such as Bills Pay-
able, Profit and Loss, etc.; but, in all cases, the accounts were
kept in the form of debits and credits. Hence the general object
of bookkeeping is to show debits and credits.
Now, what is the object of cost keeping? Primarily, its
object is to show unit costs. These unit costs may be used as
standards by which to effect reductions in costs, or as standards
by which to estimate the cost of future work. Cost keeping,
therefore, involves the use of standards of comparison, which
do not enter into bookkeeping in its original form, nor can the
use of standards be grafted upon bookkeeping without great
confusion and complication. As above stated, perhaps the best
example of the confusion and complication that follow such an
attempt may be found in the bookkeeping of railway companies.
Without discussing the matter at this time, we need but refer
to the absence of satisfactory unit costs in the accounting records
of railways and the great labor involved in digging out the data
necessary to derive unit costs of the kind most useful to the
engineer. The labor wastes that undoubtedly occur in railway
construction and operation are attributable to the hybrid system
of accounting which is supposed to be good bookkeeping and
good cost keeping, without being good in either respect. Nor
68 • COST KEEPING.
shall we dwell upon the inability of the chief engineers of rail-
ways to estimate costs accurately further than to point out that
the accounting records are so involved as to be of little or no
assistance to them.
We shall now give in concise form some of the various
reasons why cost keeping records should be kept entirely distinct
from bookkeeping records.
1. Since the primary object of bookkeeping is to show
debits and credits, all accounts must be summarized in one
book — the ledger. Since the primary object of cost keeping is to
reduce costs, no book corresponding to a ledger is needed. In-
deed it is often desirable to have cost records of different classes
of work kept in different books, in different ways, by different
men, in order to localize responsibility as well as to apply different
units as standards of comparison.
2. Cost keeping should partake of the nature of daily
reports by which a superintendent can gage the daily perform-
ance, and discover inefficiency at once. Bookkeeping accounts
may not be, and usually are not, posted promptly or completely
until some time subsequent to any performance.
3. Bookkeeping records must balance to a penny. Cost
keeping records need not be kept with mathematical precision,
except in so far as bonus payments to workmen are involved.
The object of cost keeping is to show efficiency, and this may
usually be shown by approximations fully as well as by hair
splitting exactness. Hence cost keeping records may be devised
that will require far less clerical work than is necessary when
mathematically accurate bookkeeping is used.
4. Bookkeeping is a clerical function; cost keeping is an
engineering function. It is a rule of successful management not
to ask one man to exercise many functions, particularly when
they are diverse in nature. An engineer is not interested in
recording debits and credits, or in the rendering of bills — func-
tions of the bookkeeper. On the contrary, a bookkeeper knows
nothing about construction methods and not only has little inter-
est in construction costs, but lacks the necessary engineering
training to interpret cost records and to devise methods of re-
ducing costs.
5. A contractor who has an effective and simple system
of bookkeeping naturally objects to a change to a more complex
COST KEEPING. 69
system, such as is necessary when cost keeping is added to the
bookkeeper's duties. Gilbreth's ''Office System" contains an
admirable method of bookkeeping without books, which is kept
wholly distinct from cost keeping.
6. When cost keeping is begun, it is well to start in a small
way, taking some particular kind of work, like teaming, and
applying a system of daily reports. When this phase of the work
has been analyzed and organized, some other feature is taken
up, and so on, thus developing a cost keeping system gradually.
Resistance to change is bound to be encountered, and the way
to overcome it is in this manner, a little at a time. Bookkeeping
can not be changed a little at a time. A new system of book-
keeping means an entire revision all at once, for accounts are
interdependent.
7. Cost keeping records should state conditions, such as
weather, distance of haul, etc., which are essential to interpreta-
tion of results. Sketches showing design of structures should
form part of permanent cost records. Such things are entirely
foreign to bookkeeping, and, if placed upon bookkeeping records,
simply serve to confuse them.
8. The bookkeeper enters bills for materials as they are
received, crediting the firm that furnishes them. A barrel of
spikes may be followed by a dozen picks on the bill. It is not
the bookkeeper's function to trace the spikes to their place in the
work, and, when the work is finished, to ascertain the total
number of barrels of spikes used in a particular structure. That
is the function of the cost keeper on the ground. The bookkeeper
must show that John Smith Co. has been credited with the spikes.
The cost keeper, on the other hand, cares nothing as to the par-
ticular firm credited. He is concerned only with the quantity of
spikes and the use to which they have been put. It is hopelessly
confusing to try to show in one set of records both credits, and
unit costs.
9. In studying cost records to ascertain efficiency, it is often
necessary to have several different units as standards. On
reinforced concrete work, for example, the primary unit is the
cubic yard, but there should be at least three other units, namely,
the pound of steel (for comparing costs of handling and placing
the steel reinforcement), the thousand feet B. M. (for comparing
costs of forms), and the square foot of exposed surface (not only
70 COST KEEPING.
for comparing costs of form work but costs of surface dressing).
Cost records must be sufficiently detailed for these purposes, if
not in every case, at least in some cases of concrete work. Book-
keeping records become hopeless of interpretation unless they
are uniform, and, to be uniform, they must have few units of
comparison. In brief, bookkeeping is not flexible. To gener-
alize further, cost keeping costs must be divided by units of work
done, so as to secure unit costs for comparison, which is a
process foreign to bookkeeping.
lo. Since cost keeping has as its primary object the reduc-
tion of costs, since comparisons of results secured by different
men or different machines or different methods are necessary, it
follows that standard wages and standard prices of materials
must be used. It may happen that on one job the cement may be
purchased at dift'erent times at prices ranging from $1.20 to $1.50
per barrel, and that common laborers may receive from $1.50 to
$1.75 a day. In comparing unit costs a standard price of cement
should be assumed, as $1.30 per barrel, and a common labor
standard wage, as $1.50 per day. Then comparisons become
possible. A bookkeeper cannot assume any rate of wage or any
price; he must give the actual wage or price. A cost keeper
usually finds it desirable to use standard wages or prices which
approximate the average, or actually are the average.
Time Keeping Defined. — Time keeping, in its old fash-
ioned sense, is a part of the bookkeeping system, and the time
keeper is charged with the task of ascertaining what time each
man has worked during the day, week or month, according to
the arrangement under which he is employed, and what amount
of money is due him on pay-day. The timekeeper was not con-
cerned with how much work a man did or on what process his
time was spent, so long as the general distribution of the work
was obtained. Of late years the time keeper's distributions have
become much more elaborate and now he is often charged with
considerable cost keeping responsibility. When he does cost
keeping work, the records should ordinarily be kept on separate
blanks from the time keeping.
If a time keeper, unaided, attempts to distribute the lalx)r
according to the work done, his records become complex and are
rarely reliable, for, due to his going from place to place, he
must rely upon what others (like foremen) tell him as to the
COST KEEPING. yi
performance of different men. In his attempt to balance the
statements made to him with the total time, he usually "fudges"
his distributed records.
Daily Cost Reports, By Whom Made. — Daily cost reports
may be made by: (a) individual workmen, (b) foremen, or (c)
time keepers, or by all three of these classes of employees.
Individual workmen are not always competent to fill out
reports properly, but, if the report is simple in form and relates
to work done by "skilled workmen," it is usually possible to get
very satisfactory results. Certainly the individual report is to
be encouraged wherever it can be applied, for it heightens the
individual's interest in his work.
On field contract work the foreman is the man usually re-
quired to make the daily reports. His constant presence on the
v/ork enables him to make a more accurate report than a time
keeper can make, if the time keeper is required to cover con-
siderable territory, as is usually the case.
In addition to his duty in keeping the time of the men for
purposes of paying them properly, the time keeper is often able
to attend to filling out the daily cost reports, or one or more
special time keepers may be appointed for the special purpose of
rendering daily cost reports. If the time keeper is not able to be
present constantly where a gang is at work, it is often wise to
prepare certain blanks upon which he receives reports from the
foreman of the gang, and, from these foreman reports and
reports cf individuals, combined with his own observations and
measurements, the time keeper is able to fill out the complete
daily report.
Xo hard and fast rule can be laid down as to the best per-
sons to whom report making is to be entrusted. The character
of the workmen, the size of the job, and other conditions govern
the choice.
Written Card vs. Punch Card Reports. — Daily cost re-
ports are best made on forms or blanks, and these forms are
preferably cards in which the blank spaces are marked either
in writing or by punching holes with a conductor's punch. The
written card possesses the following advantages over the punch
card:
I. It is more flexible, because the punch card is limited
in the scope of the record to what has been foreseen in the office
y2 COST KEEPING.
plus what can be written in a small space reserved for remarks.
The pad and pencil are not so limited.
2. A man can usually go ahead filling out blanks in a
written card without any previous directions, while he has to
have some instruction in the use of the punch.
3. Erasures are possible with pencil and pad but not with
a punch card. This is not always an advantage on the side of
the written card, however.
The punch card possesses the following advantages over the
written card :
1. By folding the card, or by superimposing one card on
another, a duplicate record is secured without the use of the
carbon paper necessary to secure duplicates with written cards.
This duplicate record cannot be altered or erased, and one copy
may be kept by the superintendent for his record in discussing the
work with the home office, the other being sent in as a regular
report to the proper department.
2. A dirty thumb can greatly interfere with the legibility of
a written record. Moreover the average foreman or time keeper
does not write a particularly clear hand. Punch card records
are absolutely clear and legible.
3. It is sometimes expedient to have records, from two or
more men on the same card. By having no two punches alike on
the job and having each man's punch charged to his name on the
records it is possible to have a clear and complete record of who
made the record without wasting time and space for signatures.
4. The hole made by the punch is usually less than one-
eighth of an inch in diameter, and consequently a much larger
number of facts can be recorded upon a small card by the punch
than by writing, the number of groups of facts, however, being
somewhat limited.
5. To punch a hole in a card takes much less time than
to make the average pencil record, especially where duplicate
records are made. Where a time keeper has to keep track of a
large number of men this is a very valuable feature.
6. A hole can be accurately punched while riding on a hand-
car, wagon or locomotive, when the vibration would greatly dis-
tort a man's handwriting.
7. Punch cards can be made on blue print paper from a
COST KEEPING. 73
tracing, which is an advantage where a mimeograph is not avail-
able for making white cards to be filled in with pencil.
Time Cards that Show Changes of Occupation. — In field
contract work there is usually more or less change of occupa-
tion constantly occurring. A gang of workmen may be en-
gaged in grading for a while and then may be shifted to track
laying; or at least some individual in the gang may be thus
shifted from one class of work to another. Hence it is usually
desirable to have daily report cards arranged so as to record
the exact amount of time spent by each individual on each
class of work. This may be accomplished in either one of two
ways : First, by having a separate card for each workman ;
or, second, by having a gang card on which each workman's
name or number appears, and so arranged that his time may
be placed opposite or under the tabulated class of work that
he has performed.
The individual card (a card for each workman) is often
preferable when the bonus system, or its equivalent, is em-
ployed. On most contract work, however, the bonus system is
not yet in operation, and gang cards, filled in by the foreman, will
serve the purpose of showing the total performance of the gang
and the times spent by the various individuals on different work.
There are several ways of recording the individual times spent by
men working in a gang, among which the following are typical.
Each employee is given a number, and the numbers are ar-
ranged in a horizontal line across the top of a time sheet, as
shown in Fig. i. The different classes of work are printed in a
column at the left, one line being assigned to each subclass. If
team No. i works from 7 to 9 A. M. plowing, the record is made
by the foreman, who writes 7-9 opposite ''Plowing" and under
No. I ; since this is 2 hours' work, the figure 2 is subsequently
written directly below the 7-9. If team No. i is then transferred
to work connected with rolling subgrade, and is thus engaged
from 9 to II A. M., this fact is indicated, as shown, by writing
9-1 1 under No. i and opposite "Rolling Subgrade."
Another method involves the use of *'key letters" to indicate
each class of work, the proper key letter being placed opposite the
employee's name and under the nearest half hour when he began
doing the class of work represented by the key letter. Fig. 2
shows that employee No. i, whose name is Smith, began work
74
COST KEEPING.
at 7 A. M., the key letter A being under 7, and that he was en-
gaged in excavation, since A is the ''key'' for excavation. He
continued on excavation until 10:30 A. M., when he began back
filling, as shown by the key letter C entered under 10 and in the
S/r^o/
•P/i/-
/pn 1
No. OF EMPLOYEE
I
2
3 "
OEADINO
Flowins
1-9
ExcivaUng
EoUlng Bubgrado
,.,
CONCBIltB
BABE
Htullng 6 Loading Concrete Gravel
1I-/Z
1
Hauling it Loading Concrete Sand
Laying Concrete 1
Haoling ft Unloading Cemect
BBICK
Hauling & Unloadlog
'/
Laying Brlcl^
';"
Making Cushion
»/
Hauling ft Loading Cushion San-t
CuUlne Brlcl:
"i
1
BoUlng Brick
1
riUjTTi
Putting in FiUcr
3-0
•7
Hauling a Loading FiUer Sand
Putting In Expansion Joints |
SEWEBAGE
Putting In Sewerfl ft Inlets |
Putting in Catch Basins I
PuUlng in Manholes
J
""
BAND
Screening Band
oxraBiNQ
Hauling ft Loading Gravel or Sloai !
Hauling ft Loading Sand
Hauling and Unloading Cement
BUND£I£S
Hauling ft Loading CHlng Gravtl i
or Band 1
I
Cleaning up |
1
General |
1
MACADAM
EoUlng Stone
j
Spreading Stone
/
Total Hours
10
}Q
1
Bate Per Hour
J5
10
AH remuks
must appear, on the otter lid*
City.
31 32 33
Fig. 1, — Time Card Showing Changes of Occupation.
lower square. The upper squares indicate the even hour, and
the lower squares indicate the half hour. At 3 P. M. he was
transferred to concrete work, as shown by the key letter F
under 3.
A modification of this last method is shown on page 194.
COST KEEPING.
75
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where it will be seen that the number of hours worked by each
man on each class of work is recorded under a column headed
with a combination of key letters that indicate the class of work.
On some classes of work, a gang of men is seldom split up,
but the entire gang may be shifted from one class of work to
another. A method of keeping a daily **log" of events, showing
at the same time the number of units of work done, is illustrated
on page 265.
Wherever men are being frequently shifted from one class
of work to another, some method of recording the time of shift-
ing, at least to the nearest half hour, should be used, as outlined
in the different ways above given. If a foreman does not make
an immediate record of such shifting, but relies upon his
memory to fill in his report blanks at night, he is almost certain
to make serious mistakes. Moreover, it is not unusual for a
foreman to *'fudge" the reports thus made, and even to falsify
them grossly, for the purpose of showing a seemingly high
efficiency of the men on certain classes of work ; but, if a blank
must be filled in during the progress of the work, and not at
night, a foreman risks discovery of any attempted deceit, since
his record card may be examined at an unexpected time of the
day.
Gang Report Cards. — These are usually made by the fore-
man in charge of the gang. If the gang is always engaged on
the same class of work, it is not necessary for the foreman to
keep a time record of each man's occupation, in the manner just
described ; for the foreman can fill in the daily report card from
memory. In this case the time keeper records each workman's
name and hours of work, while the foreman concerns himself
only with reporting the total number of men engaged on each
class of work and their day's performance.
A gang report card should usually show most of the follow-
ing things :
1. Number of contract.
2. Location of the job.
3. Character of the job.
4. Date of the report.
5. Kind of weather.
6. Name of the foreman.
7. Classification of work, or "key letters."
COST KEEPING. yy
8
Total hours' labor under each class.
9. Rates per hour.
10. Total pay.
11. Number of units of each class of work done.
12. Units of material and supplies used.
13. Units of materials received.
14. Units of material in stock.
15. Delays, time and cause.
16. Time machines are actually working.
17. Kind of machine or tool used and its condition.
18. Remarks.
Obviously there are many classes of work that do not require
a daily statement containing all these 18 facts; but in prepar-
ing a daily report card it is desirable to have this list at hand,
to make sure that no omissions occur.
The space reserved for ''Remarks" is usually so small that
it is rarely used. Special conditions that would naturally be
recorded under "Remarks" had better be recorded in a loose leaf
diary kept by the foreman, of which more will be said later.
In designing a gang report card, the most difficult feature
is the classification. This, however, is greatly simplified if done
according to the following system :
1. Select for the general class heads the items upon which
the unit contract prices are based, such as excavation (cu. yds.),
macadam (sq. yds.), curb (lin, ft.).
2. Divide each of these pay items into the operations in-
volved. Thus excavation involves (a) loosening, (b) loading,
(c) transporting, and (d) dumping.
3. Divide each operation into as many subheadings as there
are classes of workmen engaged upon it. Thus, the operation
of loosening earth may involve (a) teams plowing, and (b) men
holding plow.
Summing up we would have the following subclasses under
the class Excavation :
Excavation —
Loosening : ]\Ien holding plow.
Teams plowing.
Loading: Men shoveling.
Transporting: Teams.
Dumping : Men.
78 COST KEEPING.
The next thing to consider is whether the men are of the
same class, receiving the same rates of wages ; for, if they are
not, there must be a further subdivision. For example, on cement
curb construction, the classification would be as follows :
Curb —
Trenching : Laborers.
Placing cinders : Laborers,
Mixing and placing: Laborers.
Setting forms : Skilled laborers.
Finishing: Skilled finishers.
Helpers.
There are many kinds of pay items, such as macadam, that
often involve processes that are performed at widely separated
places. Thus, quarrying and crushing are processes far removed
from spreading, rolling and sprinkling the macadam. When-
ever this is the case, it is usually unwise to attempt to show all
the processes on one report card. A good general rule to follow
is to group together on the same report card only those processes
that come directly and constantly under the eye of one foreman.
Therefore one report card should show the quarrying and crush-
ing, another should show the grading of the road; and possibly
the spreading, rolling and sprinkling of the macadam should also
be placed upon the sam,e card with the grading, but not unless
the grading gang is to be always a very short distance in advance
of the macadamizing.
The commonest mistake in designing report blanks is to
endeavor to reduce the number of the blanks. It is far better to
have more blanks and to distribute the work of reporting, for it
not only simplifies the blanks, but, by giving each foreman less
to report, greater accuracy is secured. In fact, there are many
operations that can best be reported by the workmen themselves.
Thus, to continue the illustration of the macadam road work,
each of the teamsters hauling broken stone should carry an indi-
vidual report card which is punched or marked by workmen at
each end of the trip.
We have said that the pay items should be analyzed accord-
ing to the operation involved, but care must be taken not to
select operations upon which men are engaged for but a few
moments continuously. To illustrate: In mixing concrete by
COST KEEPING. 79
hand, there are usually the following operations — (a) loading
wheelbarrows, (b) wheeling, (c) mixing, (d) loading, (e)
transporting, (f) spreading and ramming. Some gangs are so
organized that a few men are kept constantly busy loading wheel-
barrows with sand and stone, while the rest of the gang spends
a few minutes wheeling, a few more mixing, and so on. Clearly
it would be foolish to subdivide the operations on the report
cards where the organization is of this character, for most of the
men are changing their operations so frequently that a foreman
would have time for doing nothing but to record their changes.
We see that the designer of a report blank should know
approximately what the organization of the gang and what the
methods of operation are to be, before he can design a report
blank that will be concise, and complete, but with no superfluous
headings. Since there are almost innumerable methods of doing
work, it is obviously impossible to furnish a set of printed report
cards that will exactly serve all cases, unless the classification
headings used are very general. However, the designing of a
report card is a comparatively simple matter once the organiza-
tion and methods of doing the work are known, provided the
foregoing system is used.
A tentative report blank can be designed either by using some
existing report card for similar work as a guide, or by referring
to some book that gives, in detail, the costs of construction work
similar to that for which the report blank is intended. From
the items of cost given in published records, a classification can
be prepared that will be of decided help in planning the report
card.
In order to economize space on a report blank, it is not
always necessary to print the classes or subclasses in full. Abbre-
viations and key letters may be used. Sometimes the mere
recording of the rate of wages opposite a class will show the
subclass. Thus, under the class of "Forms" (building wooden
forms for concrete) if a wage of 20 cts. per hour appears, also
a wage of 35 cts. per hour, it will be understood that the latter
refers to the carpenter, while the former refers to the carpenter's
helper.
Having decided upon the classification of operations and
employees, the next thing to determine is the character of the
8o COST KEEPING.
performance report, which is usually to be recorded on the
same card.
In Chapter IV we have discussed the difficulties of report-
ing daily performance, and have indicated ways of overcoming
the difficulties. It is evident that a foreman or timekeeper
should not be expected to report the number of units of each
class of work performed if any considerable amount of difficult
measurement is involved. Hence, it is usually futile to provide
for a daily report of the number of cubic yards of earth exca-
vated. On the other hand, the number of wagon loads, or car
loads, may usually be reported, and the blank used for excava-
tion should usually provide for such a report.
If some of the excavated material is shoveled directly into
the embankment or hauled by scrapers, while some is hauled by
wagons, it will be futile to provide for a daily report of loads
hauled. In such cases, it is often advisable to report merely the
number of lineal feet of work done daily. Thus, in road work,
where the excavation is shallow and mostly from ditches, the
report should show the station and plus up to which the grading
is completed at the end of the day. It is then the function of the
office force to determine the yardage from the office records.
The amount of concrete and cement work of all kinds can
be reported with considerable accuracy by stating the number of
bags of cement used during the day.
Chapter IV should be consulted for further hints on methods
of measuring daily performance of gangs.
The amount of supplies, like coal, used each day, can usually
be reported if some system be devised for recording consump-
tion or for readily inventorying the stock on hand each night.
It is generally wise to require coal to be measured in boxes or
in wheelbarrows of uniform size, uniformly filled. Then each
fireman reports the number of cubic feet (or boxes) of coal used
during the day.
Empty dynamite boxes are often convenient for purposes of
measurement, as they hold exactly ^)4 cu. ft. each.
Individual Record Cards. — Wherever individual workmen
are paid by the bonus or piece rate systems, it is usually best to
provide a separate record card for each workman, for it is difficult
to make a compact record on one card that will show not only the
occupations of a number of men, but the performance of each
COST KEEPING. 8l
man. This is particularly true where the men are repeatedly
shifted from one class of work to another.
Where one man operates a machine, like a rock drill, it is
usually wise to provide him with his own individual record card,
upon which he is required to record his day's performance. A
modification of this plan is to let the foreman carry the individual
records of all the men, and fill in each card himself.
The engineman on a dinky locomotive should be required
to make and fill in a daily report, showing the number of train
loads hauled, time lost, etc., as shown on page 151.
A teamster should usually be required to carry a card
whereon are recorded the times of arrival or departure at each
end of each trip.
A steam roller engineman should be required to fill in a card
report showing number of lineal feet of road rolled, and the
number of miles travelled by the roller. The latter should be
recorded by an odometer.
Kinds of Punches to Use. — If punch card reports are to be
used, an ordinary conductor's punch will serve for small cards ;
but it is generally desirable to have large cards, which necessi-
tates the use of a special punch having a 2 in. reach. Such special
punches are made by L. A. Sayre & Co., of Newark, N. J., and
by other railroad supply concerns.
Size and Kind of Daily Report Cards. — It is usually de-
sirable to have report cards of a size that will be suitable for
filing in the standard card index files. A size that will be found
satisfactory for general use is S^7/4 '^^^•
If reports are to be written and made out in duplicate,
the report cards should be made up in pads of alternate thin
and thick cards, so that a carbon paper may be inserted be-
tween a thin card and a thick one.
It is generally wise to have the cards tinted one color for the
original and another color for the duplicate. It is also a good
plan to designate the kind of report card by a key letter, or com-
bination of letters, which may be stamped in red in one corner
of the card. Thus the letter T may be used to designate the
daily report card of teamsters. Instead of using mnemonic key
letters, some contractors prefer to use different tints for different
classes of report cards.
This works well when there are only a few classes, but
82 COST KEEPING.
becomes confusing when there are many, and is worthless as a
means of distinguishing cards at a glance when there are very
many classes.
Where a great deal of information must be crowded on one
card, it is often desirable to provide for writing the report on
both faces of the card. This is objectionable, however, because
it makes it impracticable to produce a duplicate by the use of
carbon paper. It is also inconvenient to examine such a card
after it is placed in a filing case.
Foreman's Diary. — The foreman or the superintendent
should always be required to keep a daily diary in which
should be entered :
1. Verbal orders received from engineers and owners.
2. Verbal requests made to the engineers for grade stakes,
etc.
3. Weather conditions.
4. Remarks as to hardness of digging, poor quality of ma-
terials and supplies, slowness of their delivery, general inefficiency
of the men available, and such other conditions as bear upon the
economic performance of the work but can not be shown in the
daily report.
The ordinary field foreman will not keep a diary of much
value unless its pages are inspected daily. This, requires that it
shall be a duplicate loose leaf diary, the original leaf being sent
to the office with the daily cost report, and the duplicate, or
carbon copy, being retained by the foreman and bound in a loose
leaf binder.
Designing Punch Card Reports. — We have already enum-
erated the advantages of the punch card for certain kinds of
daily reports. One of the earliest punch cards devised for this
purpose is shown in Fig. 3, and was designed by one of the
authors for recording the daily work done by each team in
hauling broken stone for macadam. Each teamster carries a
card which he presents for punching at each end of the trip.
The diamond punch hole indicates that the loaded team left the
crusher bin at 7 105 A. M. The cross punch holes shows that it
dumped its load on the road at 8 :20 A. M. A new card is issued
to each teamster each day; but, if it is desired to provide one
card that will serve for a full week, one may be easily
designed.
COST KEEPING.
83
Fig. 4 is such a team card for macadam road work. The
punches on this card show :
1. That the team was No. 14.
2. That its pay was 35 cts per hour.
3. That the record is for the week ending July 12.
4. That the team was hauHng 2_^^ in. stone for macadam.
5. That the haul was from Station 124 to Station 185.
6. That the first trip on Monday was begim at 7 105 A. M.
and that the team reached the place where the stone was dumped
at 7 130 A. M.
Team Day
6
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Fig. 3. — Punch Card, Team,
A more elaborate form of individual punch card is shown in
Fig. 5 and is designed to show the daily performance of each
rock drill in great detail.
The punch holes in this particular card show :
I. That the holes were spaced 4 ft. one way and 5 ft. the
other.
2
3
4
5
6
7
That -|- bits were used.
That the drill was in good condition.
That the drill was No. 2.
That a 3 in. starting bit was used.
That 54 ft. of hole were drilled.
That there were 4 holes, Nos. i, 2, 3 and 4, whose
depths were 15, 14, 13 and 12 ft, respectively.
84
COST KEEPING.
(Note: A hole, No. o, is provided, in case a partly drilled
hole of the previous day has to be completed, for, in that event,
the number of feet drilled to complete the hole is punched above
hole No. o.)
Mgim'n7aii?nw>^wHafii
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Fig. 4.— Duplicate Punch Card, Teaming (original size 5"x7%")-
7. That the date was July 16.
8. That work began at 7:02 A. M., and hole No. i was
completed at 9:44; that work was stopped at 12 M. and begun
COST KEEPING.
85
again at i :oo P. M. ; that hole Xo. 2 was finished at i :i8 P. M.,
hole No. 3 at 2 136, hole No. 4 at 4 152.
It is not usually necessary to record rock drill operations to
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Fig. 5.— Duplicate Punch Card, Drilling.
the nearest even minute, as the nearest 5 minutes will ordinarily
suffice; but it is sometimes desirable to have the drillers record
the time of starting one hole and of starting the next hole. In
86
COST KEEPING.
that case this card, which provides for a time record on 2 min.
intervals, is more satisfactory than one designed for 5 min. inter-
vals. Drillers are often very slow in shifting drills from one hole
to the next, which is well shown up if the time of finishing one
hole and of starting the next is punched. Punching two holes in
the card in one square (punching double), can be used to indi-
cate time of starting a hole, while punching one hole indicates its
time of completion.
Note that in designing punch cards, space can be economized
by the arrangement shown in the upper left hand corner of Fig. 5,
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Fig. 6. — Punch Card, Blacksmith.
where the upper line indicates ''tens" and the lower line indicates
"units."
The punch card lends itself well to recording the work done
by individual men, or by one skilled man assisted by a few helpers,
as exemplified in the blacksmith report card. Fig. 6. Here, it
will be seen, the blacksmith punches the number of hours spent at
each class of work. The nearest half hour is designated by
punching on the line between the two full hours. By punching
a blank card for every bit sharpened, the smith keeps tally of the
number sharpened, and, at the end of the day, punches the num-
ber on this report card.
COST KEEPING.
87
On some classes of work, particularly shop work, it is often
desirable to have a separate punch card for each class of work,
instead of recording several classes of work on the same card.
Fig. 7 illustrates such a card that has been used by the National
Switch & Signal Co. and was described by Mr. Chas. Kansel
and published in the "Complete Cost Keeper," 1903. Each
workman perforates the five-minute time card for each job on
which he is employed, simply piercing the card at the five-minute
points most nearly representing his times of beginning and ending
TIME CARD
Workman's No
Date
Date Commenced
H| iMin.
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Fig. 7.— Punch Card, Shop Work.
work on the job in hand, the appropriate order number being
entered on the card by the foreman. When the workman enters
the shop in the morning, he is furnished with one time card,
which he hangs on the upper hook of his individual time board,
after perforating it at his beginning time. If the foreman gives
the workman a second job before the first is completed, he fills in
the order number on a second card, and hangs this second card
on the upper hook. Thus the workman may have any number
of jobs before him, each order being given on a separate card.
When any job is completed its card is transferred to the lower
88
COST KEEPING.
hook. The time cards on the lower hook are removed by the
time keeper each morning, cards on the upper hook being left
undisturbed.
Punch Card Showing Time and Occupation of Each
Member of a Gang. — It is frequently desirable to record the
amount of time spent by each member of a gang on each kind of
work performed by him. Some ingenuity is required to design a
punch card for this purpose, without making the card too large.
Fig. 8 shows a punch card (for a rock channeling gang) that
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Fig. 8. — Punch Card, Rock Channeling.
provides for ly men in a gang with lo different occupations.
The names or numbers of each of the men are written in the
center of the card, with their rates of wages. All the rest of the
data is punched.
It will be noted that Wilson, Smith and Murphy each has
one punch mark above his name, and to the left of the figure 8.
This shows that each of them worked 8 hrs. ; but at what class
of work? At the right of the figure 8 are three punch marks,
under A, B and C, indicating channeler, helper and fireman.
Which of these three men is the channeler? To find out, drop
down to the lower half of the card, where the key letters A, B, C,
etc., are found in a vertical column. Running the eye along the
' COST KEEPING. 89
horizontal line from A to the left, we find a punch mark directly
under Wilson's name, which shows that he is the channeler. In
like manner, the punch mark under Smith's name, and to the
left of B, shows that he is the helper.
The fourth man, Connors, has two punch marks over his
name, one opposite 6, and one opposite i. To the right of 6 we
find a punch hole under D, which is in the column marked muck-
ing; and, since there are no other punch holes opposite 6 and
over the names of other men, it is clear that Connors spent 6
hours mucking. But it is not so clear at first glance what the
punch hole above Connors's name to the left of the i means, for
we find two punch holes to the right of i, through H and J, in-
dicating work in connection with water supply and fuel supply.
On which of these classes of work did Connors spend the i hr. ?
Dropping down to the vertical column of key letters, let the eye
travel along the line to the left of H until it comes under
Connors' name; there we find a punch hole indicating that he
worked i hr. on water supply. But we see still another punch
hole below Connors' name and to the left of J ; hence he worked
another hour on fuel supply. This makes the total of 8 hrs. for
Connors.
The men whose numbers are 432, 447, 381 and 376 each
worked 5 hrs. at track laying; but man 432 has a second punch
mark over his name, to the left of i ; we find what this i hr. of
work was by looking for the punch marks below this man's
number (432) ; for there we see that in addition to his having a
punch mark to the left of E, which relates to his 5 hrs. on track
work, he has also a punch mark to the left of J, which relates to
his I hr. spent on fuel supply work.
This same scheme of indicating each man's work and the
time spent upon it is susceptible of wide application, as will be
seen by referring to the report cards in Chapter VIII.
In addition to the record of time spent by each man on the
different classes of work, the card in Fig. 8 shows :
1. That the day was Mar. 17.
2. That 26 cu. ft. of coal were used by the channeling ma-
chine.
3. That 2 pts. of oil and i lb. of waste were used.
4. That the length of the first cut was ;^2 ft. and its depth
36 ins.
90 COST KEEPING. "
5. That the length of the second cut was 22 ft. and the
depth 18 ins.
6. That the area of the first cut was 96 sq. ft., and that of
the second cut was ^^ ft.
7. That the total area was 129 sq. ft.
While the description of such punch cards sounds compli-
cated, experience has demonstrated that any foreman or intelli-
gent workman is easily taught how to use them.
The important thing to impress upon the man who is to
make out the report is that every workman must have at least
one punch mark above his name and one below it, and that there
must be a third punch mark on the line to the right of the upper
punch mark and directly under the key letter which shows the
nature of the work done, and that the punch mark below the
man's name must be on the line to the left of the same key letter
— the three punch marks showing the time spent and the kind
of work.
Duplicate Punch Cards. — It is often desirable to have a
duplicate record of the daily report, one copy of which is sent
to the office and the other retained by the man who makes the
report. This is easily done with a punch card designed as shown
in Fig. 9, so that, when folded along the center line, the duplicate
half comes exactly below the original half.
The maintenance of way card, Fig. 9, shows the number of
men employed on the various classes of work indicated, the time
spent on each, and the location of each class of work. The first
column of figures indicates hundreds, second column tens, and
third column units, so that 999 is the largest number that can be
punched.
The particular card illustrated gives the following informa-
tion :
The work consisted of renewing ties and surfacing track
and was located between telegraph poles 121 and 990. There
were ten ties renewed and 260 feet track surfaced, and two hours
were spent in traveling. There was a total of six men employed.
All worked one hour on D (renewing ties), all spent two hours
traveling, and all spent seven hours on F (surfacing track).
Thus the work was distributed over D, F, K, as shown in the
lower right hand corner, and all six men worked on each item.
At this place is also shown the rates of pay. All the laborers
COST KEEPING.
91
received 14 cts. an hour and the foreman received $50.00 per
month. The date was May 21, and the foreman's name was
Applin.
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Fig.
-Duplicate Punch Card, Maintenance of Way.
It will be noted that w^hile the original card will show clearly
the number of units of work done, etc., the duplicate, which is
retained for an official copy and is not much used, must be read
backward.
92 COST KEEPING.
Record Cards Accompanying Each Piece of Work. — In
doing machine shop work, it is often necessary to liave one piece
of metal pass through the hands of several workers. For example,
one man may drill holes of a certain size, another may drill holes
of another size, still another may thread the holes, and so on. In
such a case a record card may be attached to, or accompany each
piece or lot of pieces. In blanks provided on the card, each
worker enters his number and the amount of time spent in doing
a specified kind and amount of work on the piece.
Using Several Record Cards, One For Each Piece of
Work. — A method that is usually preferable to the one just
described for shop work, is to give each workman several record
cards. As each new piece of work comes to him, he enters its
"order number" on a record card, and records the time he spends
on the piece. When finished, he uses another record card for
the next piece. Fig. 7 shows a punch card designed for this
sort of record.
Store Keeper's Reports. — The store keeper's duties in-
clude the following :
1. He must receipt for and take charge of all material de-
livered for temporary storage.
2. He must see that all of this material is properly ac-
counted for and none lost or stolen.
3. He must take charge of the issuing of materials and
supplies to the men and see that they are issued in proper
quantity and that there is no waste.
4. He should see that needed material and supplies are
issued without loss of time.
To accomplish these objects it is necessary that some one
be on hand at the store house at all times when material is likely
to be delivered or called for. This includes the noon hour as well
as other times. Considerable economy results from sending to
the store house in the noon hour to obtain articles that are needed
in the afternoon.
The second duty of the store keeper is often interfered with
by men going to the store house for articles needed in a hurry
and not leaving receipts for them. The only way then that the
store keeper can account for his materials would be by periodical
inventories, and then at the best there is nothing whereby the
periodical inventory can be checked. The perfunctory inventory
COST KEEPING.
93
is generally useless. All the men in the field in the position of
authority or who are likely to require to have materials issued to
them should be provided with small requisition blanks similar to
the one shown in Fig. lo, and the store keeper should require a
requisition slip as a receipt for all material issued.
At the end of the month these receipts for material issued
should tally with his inventory and list of material received.
Watertord, N. y.,
-190
TO STORE KEEPER
FORT ORANGE CONSTRUCTION CO.
Please Deliver to Bearer
Charge.
Fig. 10.— Requisition Slip.
On some work it is customary for the store keeper to go
around the job interviewing the different men who may need
material and take charge of getting the material to them, taking
a receipt for material from the messenger. These receipts then
form part of the record. Another way is for the foreman of each
gang every night to turn in with his report a statement of the
material that he w-ill need and when. The requisition part of the
report can then be abstracted and turned over to the store keeper.
This latter plan has the objection that, unless somebody works
94 COST KEEPING.
over-time, it is difficult for the store keeper to get the material
as early as it is likely to be wanted. The rule of requiring receipts
for material should be applied even to such large units as piles
and timber generally. Although it seems at first glance an easy
matter to keep track of such large units w^ithout the application
of any particular system, it is found exceedingly difficult in
practice.
After material and supplies have been issued by the store
keeper they may remain upon the work for some time before
being actually used. This applies particularly to such material as
dynamite that is kept in magazines. The key of the magazine
should be in charge of one man who should record the number
of cases that he removes during the day. One of the best methods
of getting this record is to have a card hanging by the magazine
door and require the magazine tender to punch a hole in the card
for every case of powder that he moves. This card can then be
turned in to the store keeper each day, from which the records
of powder used and powder on hand can be kept posted. The
same method works very well for recording cement.
In general, when the material records are made by produc-
tive laborers in the field they should be made to the store keeper
and be checked and handed out by him.
When no definite rule is established for the prompt obtaining
of material on request the inability to obtain material promptly
is used as a most prolific excuse for not getting work done.
In a certain case in point some important work was delayed for a
long time because a pump gasket blew out just after the requisi-
tion rule had been instituted on the work and before the store
keeper realized the necessity of promptness in making deliveries
or the directness of his responsibility.
Reports on Materials and Supplies. — Fig. 1 1 shows a
requisition blank for materials, which is self explanatory.
Fig. 12 Is a card for reporting supplies received. It includes
the oil, waste, powder, caps and fuse supplied to the various
field organizations, such as drillers, pumps, various steam shovels,
dinkeys, cars, shovels, and also shows the amount remaining
on hand. This Is for steam shovel work In rock.
Fig. 13 is a material card designed to be used daily by the
foreman on concrete work for recording the materials received.
The size of various loads of cement, gravel, sand, screenings.
COST KEEPIXG.
95
IVO f;n DANSYILLE AND MT. MORRIS R. R. material
i ' • tf\f A. S. MURRAY. Jr.. RtctivCR
REQUISITION ORDER DANSVILLE. N. Y.. _ - 19
TO
PLEASE FURNISH THE FOLLOWING MATERIALS
DELIVER VIA.
D. L. A W. R. R.
DELIVERY NOT ACCEPTED
APPROVED
-OEN. SUPT.
Fig. 11. — Requisition Blank.
stone, and the number of feet board measure of lumber are
shown on one half of the card, and on the other half are the
amounts of glass, steel, lampblack, oakum, nails, etc. On the
back of the card an entry is supposed to be made of all material
sent away from the shop or remaining on the work at night, thus
giving a check upon the quantity of materials used.
SUPPLY
m?T>nTiT
xn 1
inn 1
Drillers.
Pumps.
Vo. 1
Bhovel.
No. 2
ShoveL
No. 1
DiDicey.
No. 2
Dinkey.
No. 3
Dlnlcey.
Cars.
Shop.
Little
Hill.
Oq Hand.
CyLOll
Kng. " ....
Blk, "....
'Waste
Dyiiamlte.
Exploders.
Caps,
Fuse
Fig. 12. — Blank for Reporting Supplies Received.
96
COST KEEPING.
Checking the Accuracy of Reports. — Systematic checking
of the accuracy of reports made by individuals or foremen is of
paramount importance, for, unless this is done, there is apt to be
gross falsification of the reports in order to make a favorable
showing of performance. Thus, if a drill runner is not checked
occasionally as to his report of number of feet drilled, he is apt
to add several feet to his actual performance.
On one railway with which the authors are familiar, the
master mechanic is in the habit of reporting the time of men
spent in building new cars as if it were spent in repairing old
cars. The object in doing this is to make a creditable showing
Job No.
MATEBIALS RECEIVED
Date
190
Foreman
Size or Brand
From Wbom Beceived
Size or Brand
From Whom Beceived
bbls.
Cement
bbls.
Glass
bags
'•
bars
Steel
Ids.
Gravel
"
"
•..
Bond
••
w
"
Bcreenlngs
"
"
lbs.
Stone
lbs.
Lampblack
-
•«
••
Oakum
Ids.
Sand
-
IWto
ft
Lumber
Fig. 13.— Blank for Reporting Materials Received.
of the cost of making new equipment. While it is true that this
seems like robbing Peter to pay Paul, it must be remembered
that there is usually great difficulty in determining just what is
a reasonable cost of repairing a car, whereas there is no diffi-
culty in fixing upon a reasonable cost of making a new car.
So many men are dishonest, particularly in ways that are
not actually criminal, that implicit trust should not be placed
in reports that are not verified by systematic investigation at un-
expected intervals of time, if they are not subject to constant
checking.
On construction work it should be the duty of some one to
make reports that will check the reports made by individual
'OST KEEPING.
97
workmen and by foremen. The time keeper is usually the man
upon whom part of this checking devolves. Thus, the time
keeper may be required to make certain measurements at the
close of the day, from which a foreman's report of performance
can be checked, as, for example, the number of drill holes and
the depth of each. The time keeper may also be required to
visit each part of the work frequently, noting the number of
men engaged in each class of work at the time of each visit. Fre-
quent visits are often made possible by providing the time keeper
with a horse or a motorcycle.
Checking the distribution of the men of a gang, as well as
observing the energy with which they are working, may fre-
quently be done to advantage by means of a telescope or field
glasses in the hands of an observer located in a tower or on
some high point of ground.
By requiring different foremen and different individuals
to report on the same performance, an excellent check can often
be secured. Thus, a dinkey locomotive engineman should
report the number of trains hauled, and either the dump foreman
or the steam shovel engineman should render a similar report.
The monthly estimates of engineers should, of course, be
used to check the daily reports of foremen, as far as possible;
and on large jobs it is often desirable for a contractor to employ
engineers to cross-section and measure the work once a week,
if not more frequently.
Where the gang under a foreman is frequently shifted from
one class of work to another, the foreman should always record
the time that the change is made, in one of the ways already
indicated. When this is done, the superintendent or walking
boss should examine the foreman's record pccasionally, during
the day — not necessarily every day — to assure himself that the
foreman is posting the record properly and at the time each
change is made.
There should always be some system of recording the receipt
of daily reports at the office. This is sometimes effected by
having a tabular list of all the reports that should be received,
and by placing a check mark opposite the name of each report
(or each foreman or individual making the report) under the
day of the month to which the report relates. A glance at such
a tabulation shows whether any report is missing.
98 COST KEEPING.
If it is the practice to plot or chart the returns shown by
each report daily, then no further check may be needed to show
that the report has been received.
One of the advantages gained by divorcing cost keeping from
bookkeeping is the check thus obtainable on both. The aggre-
gate weekly pay roll shown by the time keeper's report should
check fairly well — not necessarily with great precision — with the
aggregate pay roll deduced from the foreman's reports. Inci-
dentally this check makes it more difficult for a time keeper to
*'pad the payroll :" that is, to enter fictitious names upon the
payroll or to credit a man with more time than he is entitled
to. Many a contractor has been robbed in this manner.
If the distribution of costs shown on the books corresponds
with the distribution derived from the daily report cards, a fairly
close check is obtainable.
It is generally wise to have accounts for each of the main
items of materials and supplies, such as lumber, cement, coal, ex-
plosives, etc. Then the total consumption of coal, for example,
as deduced from the foremen's daily cost reports, should check
fairly well with the amount purchased, as recorded by the book-
keeper. Likewise the bookkeeper may divide the payroll into
certain general classes of labor and assign an account for each
class, which should check with the cost records turned in by the
foremen. But, in our opinion, it is a serious mistake to encumber
the bookkeeper with a multiplicity of accounts intended either to
show detailed costs or to check the various details of cost deduced
from the daily cost reports.
Cost Charts. — For showing relative performance or rela-
tive unit costs, no method is so satisfactory as a diagram or
chart. A glance at the unit cost line plotted on a chart shows the
manager whether there is cause for congratulation or alarm. The
up and down waves of a cost line are far more impressive than
columns of figures ever are.
A chart of daily performance has the incidental advantage
of affording an automatic check as to whether all the daily
cost reports have been turned in or not, for without the reports
the lines on the chart can not be plotted.
The chart shown in Fig. 14 was 8^x11 ins. — a large enough
size to show the unit costs with sufficient accuracy for compara-
tive purposes.
COST KEEPING.
99
It will be noted that three lines are plotted on the chart.
The upper line, drawn in full, marked A, shows the total daily
yardage of rock loaded by two steam shovels. The line C shows
the cost per cubic yard. The line B shows the total daily operat-
Fig. 14.— Efficiency Chart, Rock Excavation.
100 . COST KEEPING.
ing expense, including only the payroll and not the cost of fuel,
dynamite and other supplies.
The unit cost line, C, is the only one that presents any
difficulty in plotting. On most contract work, some of the men
are paid by the month, and their wages go on whether it rains
or shines. The number of working days in the month (excluding
Sundays and holidays) divided into the total monthly payroll of
these ''steady pay" or "monthly pay" men gives the daily payroll
of the ''monthly pay" men, to which must be added the payroll
of the men who work by the hour or by the day. On days when
the weather is so bad that no work at all is done, the daily pay-
roll of the "monthly pay" men would be divided by nothing, which
gives an infinite unit cost, and therefore can not be plotted. But,
if it is not plotted, and if there are several days in succession on
which no work is done, the unit cost line ceases to show the true
unit cost. This difficulty, however, is more imaginary than real,
for the object of the chart of daily costs is not to show whether
a profit is being made, but to show how well the work is being
managed on those days when the weather is such as to permit
any work to be done.
In plotting a chart of costs, the performance can be plotted
each day in pencil and can be inked in at the end of the week on
tracing cloth and blueprinted. As many copies as desired may
then be sent to the home office.
Referring to Fig. 14, we see that conditions of weather,
accidents, etc., can be recorded on the chart. The full history of
the work shown by this chart is as follows :
The shovels did not work on the ist or 2nd of the month,
but one shovel started on the 3rd, making a record of 780 yards,
which was the highest point that had been reached for several
months. The cost of operation of both shovels was $240, making
a unit cost for the output of one 38 cts. On the next day the
other shovel worked, but the total output of both was only 885
yards, and, while the total cost rose to $285, the unit cost dropped
to 31 >2 cts. On the 5th of the month, being Sunday, no work
was done. On the 6th the work was badly interfered with, be-
cause the water pipe, which supplied water to the work, was
frozen, and the output of the shovels fell to 660 yards, while the
total cost was raised slightly to $290, making a much higher
unit cost of 43^ cts. On the 7th one shovel worked in a crippled
COST KEEPING. lOI
condition for the whole day, while the other worked only a half
day because of the short supply of water. The performance
dropped still further to 580 yards, on account of the fact that one
entire pit and dump crew was laid off for half a day, and the
unit cost fell to 42 cts. On the 8th both shovels were held up
for nearly half a day because of poor blasting in front of them
and the necessity of drilling- and blasting in the shovel pits.
Because of the likelihood of starting at any time the crew could
not be laid off, so the total expense was kept up to about $260,
making the unit cost jump to 513^ cts. On the 9th both shovels
were working in good shape and produced an output of 890 yards
with a complementary reduction in unit cost, since the total labor
cost was increased but little. On the loth the performance
dropped slightly, but on the nth it again rose, reaching 975
yards. The total labor cost for this day was higher than it had
been any time during the month, while the unit cost was about
34^/2 cts. The 12th was Sunday and no work was done, and on
the 13th but one shovel was working, as the other shovel was
moving back in the cut. The high total labor cost maintained
caused a very steep rise in the unit cost line. On the 14th one
shovel was still moving back while the work of the other shovel
was badly delayed because of trouble with poor coal both on the
shovel and on the dinkey locomotives hauling dump trains. This
difficulty was overcome to some extent on the 15th and i6th, but
the output was still very low even for one shovel. On the 17th
the second shovel cut in, but owing to a very shallow cut and
frequent moves necessary, a very small output was obtained.
The next day, however, both shovels were working well and got
out 1,020 yards. The 19th was Sunday. On the 20th the output
was maintained at rather a high figure, being 875 yards ; on the
2ist the output dropped because of rain ;* rose again on the 22d
and went still higher on the 23rd, reaching on that day 1,230
yards, which was the highest daily output of the month, and on
that day the lowest unit cost is also shown. On the 24th the
output fell because one shovel was delayed by having to wait
for drilling, and on the 25th only 230 yards were taken out be-
cause neither shovel worked more than a few hours because the
water supply was shut off by the freezing up of the pumping
*Weather and some other conditions mentioned here are not shown,
but are mentioned by way of explanation.
102 COST KEEPING.
station. The 26th was Sunday and no work was done, but on the
27th the output jumped to a high point, reaching 1,180 yards,
and the unit cost fell to 23^/^ cts. The next day the output was
130 yards less, but the total labor cost was also much less and the
unit cost was maintained at 23}^ cts. The performance fell a
little lower on the 29th, but was still well above the average, but
on the 30th fell to less than 100 yards because the weather was
so extremely cold (minus 18° F.) that the men could not work.
In this case the fixed charges of the shovel raised the unit cost of
the 90 yards taken out to about $1.50. When work was re-
sumed on the 30th 875 yards were removed at a cost of 30 cts.
a yard. The jagged nature of the lines on this chart is due to
the character of the weather. It will be noted that the general
trend of the unit cost line was downward.
The channeler chart, Fig. 15, shows only the performance
and unit cost of the work done. This record is also for the
month of January. Work began on the 2nd, the performance
being but 160 feet of channeling done by two crews. The per-
formance fell from that point to 85 feet on the 5th and rose to
185 feet on the 6th and again fell and remained low until the
9th. These bad records were due to the presence of nigger heads
in the rock being channeled which made fast work absolutely
impossible. On the 9th the performance rose to 160 feet, and
kept on increasing until the nth, when 200 feet was reached.
On the 13th, 14th, 15th and i6th the performance was low be-
cause of poor track. The track was fixed by the 17th, when
performance again rose and was maintained at a figure slightly
above the average until the 24th, when, because of the extreme
cold, one crew deserted its posf and allowed the pipes feeding
the machine to freeze. On the 29th the performance fell slightly,
due to the clogging of the channeler by earth sliding into the
cut, and the unit cost rose because it was necessary to put on an
extra force to clean out this earth. On the 30th but little work
was done owing to the extreme cold, but on the 31st the high
record of the month was made, 370 feet being channeled.
Progress Charts. — It is generally desirable to record
graphically the progress of each particular class of work on a
contract. This is best done by means of a progress chart similar
to that shown in Fig. 16, which is a modified form of the chart
shown on page 184.
COST KEEPING.
103
This chart relates to excavation. The first column is a
percentage column. The second column gives the length of the
excavation (trench, ditch, or the like). The third column gives
the number of cubic yards. The fourth column gives the esti-
mated cost. The fifth column gives the actual cost; a sixth
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104
COST KEEPING.
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Fig. 16.— Progress and Cost Chart, Trench Excavation.
COST KEEPING. I05
column of actual cost is provided in case it overruns the esti-
mated cost. The total length of the excavation to be done is
775 ft., which is written opposite the icx)7o. Then the length
column is divided into y}i parts, each representing 100 ft., or a
''station."
The total yardage in this length of 775 ft. is 1,600 cu. yds.,
which is also written opposite the 100%. Then this yardage
column is divided into 16 parts, each representing 100 cu. yds.
The work has been estimated to cost 50 cts. per cu. yd., there-
fore the total cost of the 1,600 cu. yds. should be $800, which is
written opposite the 100% ; and the estimated cost column is
divided into 8 parts, each representing $100.
This work on section of excavation is scheduled to begin
June 3, as indicated in the space to the left of the percent
column and at the bottom; and it is scheduled to be finished in
three weeks, as indicated.
The work is begun on schedule time, June 3, as indicated
by the entry to the right of the last column, and at the end of the
first week (beginning of the next), June 10, the progress and
cost are shown by the hatched portion below the heavy black
line. It will be seen that the excavation has been completed to
station I -f 50 ( = 150 ft.), as shown in the second column; and
that 350 cu. yds. have been excavated, as sho\vn in the next
column. The estimated cost of the 350 cu. yds. is $175, as shown
in the fourth column. The actual cost has been proved to be the
same as the estimated cost, or $175, as shown in the fifth column.
The yardage completed up to June 10 is 22% of the total, as
seen by comparing the first, or percentage, column with the third,
or yardage, column ; whereas, to have lived up to the estimated
schedule, 33% of the yardage should have been excavated by
June 10.
The performance of the next week is similarly shown by the
heavy black line opposite June 17, which shows that 375 ft. of
length (reaching therefore to Sta. 3 + 75) and 900 cu. yds.
have been completed. The total actual cost is now $400, as
compared with an estimated cost of $450, showing that the
work is being handled satisfactorily.
If the chart is plotted on tracing cloth, blue prints are readily
made. Instead of cross-hatching the performance area of each
week, paints of dift'erent tints may be used.
I06 COST KEEPING.
On jobs of long duration, a similar chart showing progress
by months is usually desirable, in addition to a weekly progress
chart. Then it is often desirable to paint the area on the monthly
progress chart, using the following colors of paints to designate
the different months:
January Chrome Yellow
February Carmine
March .Payne's Gray
April Deep Chrome
May Prussian Blue
June Burnt Sienna
July Sepia
August Emerald Green
September Cobalt Blue
October Vermilion
November Indian Red
December Sap Green
Charts of this sort should be prepared for each of the
different classes of work, and, if the job is large, it should be
divided into sections, each having its own progress chart.
Finally, the manager should have a chart showing the prog-
ress of the job as a whole. To prepare such a chart, it
is generally sufficient to reduce all the units of- work done to
the common unit of the dollar. To do this take the estimated
costs, given in the fourth columns of all the weekly charts, and
add them together. The sum will give the total amount of
work done, based on the estimated unit prices. Then do the
same with the actual cost columns. Plot these totals for the
entire job, in columns side by side, as shown in Fig. 17.
This summary chart, Fig. 17, shows that the estimated cost
of the entire job was $20,000 (indicated by $2oM opposite
100%). It shows that the work was scheduled to begin June i,
and to be finished Oct. 31. As a matter of fact it was finished
Oct. 10 and its actual cost was $21,000.
On July I, the total number of units of work done multiplied
by their respective estimated unit costs amounted to $3,500, as
shown in the second column ; while the actual cost was $4,000.
On Aug. I, the total work done, at estimated unit prices, was
$7,000, and its actual cost was $6,800. Only 35% of the work-
was finished, although the time schedule calls for 40%.
COST KEEPING.
107
Fig. 17. — Progress and Cost Chart. Entire Job,
Io8 COST KEEPING.
On Sept. I, however, the work is ahead of the scheduled
time, and it also shows a greater cost than was estimated.
A similar condition exists on Oct. i.
The work is finished Oct. lo, and since its actual co5t over-
runs the estimated cost, it is necessary to plot the actual cost in
the fourth column, where it is seen that it amounts to $21,000.
In preparing a time schedule, the first step is to take the
time limit, as specified in the contract, and use this as the basis
for planning the performance. A study of the plans and local
conditions will determine what classes of work and what sections
must be first started. Time schedules should be prepared for
each of these, due allowance being made for the time required
to deliver and install the plant, which is often an important con-
sideration. If there is much plant to install, it is obvious that
the intervals in the time schedule will not be evenly proportioned
as in Fig. 17; but the schedule of performance for the first month
or more will be much less than for succeeding months.
Once a time schedule has been carefully prepared, every
effort should be made to live up to it, not only in toto but in
every section, in order to prevent disorganization of the work.
The function of the progress chart is to show how well the plans
are succeeding.
History and Sketches of the Work. — As the work pro-
gresses, a brief — but not too brief — history should be kept of its
progress, like the log of a ship. The organization of the forces,
the number, kind and location of the machines should be recorded.
Sketches should be made to show plant layout and local condi-
tions. Sketches should also be -made to show the types of con-
struction. Large working drawings are usually too cumbersome
to be of much value in any historical outline of the methods
of construction.
Finally, when the work is completed, a complete history
should be written in as condensed form as is consistent with a
clear understanding of its governing features. This should be
typed and bound in a loose-leaf binder, together with the sketches
and photographs that illustrate it.
Too much emphasis can not be laid upon the importance of
such a written history, for memory, at best, is defective, and it
often takes but a few years to render bare figures of cost almost
worthless even to the man who gathered them. There is a
COST KEEPING. 109
further consideration — namely, that the employee who was most
familiar with the work may resign or die, leaving the construc-
tion company with a mass of data that would possess great value
if accompanied by a full sketch of conditions encountered and
methods used, but which are more or less useless without such
a sketch of conditions and methods.
CHAPTER VI.
OFFICE APPLIANCES AND METHODS.
There are many appliances which can be used In the office
for the compiHng of records gained in the field and which rec-
f>mmend themselves to general office systems.
pwran
Fig. 18.— Time Clock.
Time Clocks. — Such an appliance which may not, In gen-
eral, be used in the field, but which Is of Immense value In the
office and particularly in a shop, is the time clock. Various forms
of time clocks are In common use, two types of which are illus-
trated. Fig. i8 Is a time card recorder, which is a clock so
no
OFFICE APPLIANCES AND METHODS.
Ill
made that it will automatically stamp on a card inserted in a slot
in the clock by the workman the time of his arrival and of his
departure. The cards are made to hold a record covering the
pay period and need no attention from a timekeeper or clerk
until the termination of this period. The record of the men's
time can then be compiled very readily by one who need not be
a skilled mathematician or time clerk.
Fig. 19.— Time Clock.
The time clock system has been developed very highly in
shops for keeping track of time used in completing any job by
workmen, but as this in a way is not in the realm of field cost
keeping, it will not be entered into here.
Another form of time clock, shown in Fig. 19, has the num-
bers of the employees fixed on the outer edge of a disk or ring
and a record is made by the employee who shifts a revolving
arm and punches his number upon entering the office and leaving.
112
COST KEEPING.
The working up of the employees' time then becomes simply a
matter of computation from printed figures. These two types are
made by the International Time Recording Co. of New York.
An automatic time stamp, Fig. 20, i§ of inestimable value in
a well regulated office. Such a stamp can be placed upon any
sort of a paper received in the office and shows the hour and
minute both morning and afternoon and date of receipt, and, in
a machine with various refinements, the name and address of the
Fig. 20.— Time Stamp.
owner, the classification of the matter received, and a mark indi-
cating the person who received it. In the case of orders issued
to field employees or reports received from them, such an accurate
stamped record as this machine will give might avoid serious
controversy in case of delay from any cause. The exact time of
receipt of a report is shown or the exact time of the issuing of
an order, and, if the order is not promptly obeyed, the man to
whom the order is issued cannot plead the excuse that the order
was not issued until after a time too late for its effective execu-
tion. Such a machine can be purchased for from $20.00 in its
simplest form to $100.00, embodying all refinements.
OFFICE APPLIANCES AND METHODS.
113
Rubber Stamps. — A full equipment of ordinary rubber
stamps will be found decidedly useful in an office. Not only is
much writing saved by their use, but accuracy is insured.
Mimeograph. — In its simplest form the Edison mimeo-
graph consists of a frame for holding a stretched sheet of paraf-
Fig. 21.— Mimeograph.
fined paper, and a block of steel that has been cross-ruled with
very fine lines. The paraffined paper is laid on this block, and
a stylus, or pen, having a blunt steel point, is used for writing
or drawing on the paper. The stylus is pressed rather hard on
the paper, and the little sharp teeth of the steel block cut minute
Fig, 22. — Counter.
holes through the paper. Having written 01: drawn as much as
is desired, the steel block is removed, and for it is substituted
the card, or paper, that is to receive the impression. A small
roller, inked with printer's ink, is then run lightly over the
paraffined paper. The ink passes through the small holes in the
114 (^O^T KEEPING.
paraffined paper and prints on the card below. Then another
card is substituted, and printed, and so on indefinitely. The
mimeograph is really a sort of printing press that can be used
by anyone.
Fig. 23. — Adding Machine.
There are various sizes and kinds of mimeographs. Fig. 21
shows one whose price is $45. Others that are cheaper and
others that are more expensive are obtainable.
The authors have used the mimeograph extensively for
making report blanks, as well as for issuing orders. On any
Fig. 24.— Multiplying Machine.
new class of work, it is generally wise to use mimeographed
report blanks, for changes in the methods of doing the work
and in the organization are likely to occur, and such changes
OFFICE APPLIANCES AND METHODS. 115
frequently necessitate alterations of the report cards. A new
report card can be quickly designed and hundreds struck off with
a mimeograph, without any delay in waiting for printers.
The mimeograph is made by The A. B. Dick Co., New York
and Chicago.
Counters. — Fig. 22 shows a Veeder counter (price $1),
which may be attached to the form of mimeograph shown in
Fig. 21, for recording the number of cards printed. Such a
counter can be made to serve many useful purposes in the field,
Fig. 25. — Adding and Multiplying Machine.
for recording revolutions or reciprocations of machinery. The
Veeder counter is made by Veeder Mfg. Co., Hartford, Conn.
Adding Machines. — Where there is any considerable
amount of office work, an adding machine should certainly be
used. Fig. 23 shows a Burroughs adding machine, which records
the column of figures on a strip of paper and adds them at the
same time. This machine is made by The Burroughs Adding
Machine Co., Detroit, and costs from $175 to $850.
Multiplying Machines. — The Brunsviga machine, Fig. 24,
for multiplying and dividing is extensively used in railway ac-
counting departments. It is very rapid and perfectly accurate.
Il6 COST KEEPING.
This machine is listed at $300, and is made by Carl H. Renter,
Land Title Bldg., Philadelphia.
Another machine that is extensively used for multiplying is
the Comptometer, Fig. 25. It is also used for adding, but has
the disadvantage that it does not print the figures, as does the
Burroughs machine. Its price is $200 to $315 and it is made by
Felt and Tarrant Mfg. Co. of Chicago.
Slide Rule. — It is of course understood that the slide rule
is not a multiplying machine that is accurate beyond certain limits.
Within those limits — which depend on the kind and size of the
rule — it is perfectly accurate. For purposes of estimating and
for making ordinary designs, the slide rule gives results that are
close enough. A lo-in. rule — the size most commonly used —
costs $4.50. Any dealer in civil engineering instruments w^ill
furnish slide rules.
Planimeter. — The planimeter, like the slide rule, is so well
known as scarcely to require mention here. For figuring the
areas of irregular cross-sections, the planimeter is a great labor
saver; but its absolute accuracy depends largely upon the scale
to which the cross-section is plotted. The commonest error in the
use of a planimeter is the plotting of cross-sections to a small
scale.
There are many styles and sizes of planimeter, ranging in
price from $16 to $100. A good instrument for ordinary use
can be had for $30.
Wage Tables.— A great help to the contractor's office is a
wage table. This table gives the amount of pay due for each
quarter of an hour worked at rates from 5 cts. up, for eight, nine
and ten hours w^orked per day. If the rates of pay on the work
are irregular, no small amount of time can be saved by the use
of such a table, and, in any case, the liability of error in com-
puting wages is almost entirely eliminated. One such book of
tables is got out by the International Time Recording Co. and
sells, bound in cloth, for $1.50.
How to Systemize the Office. — We are indebted to Mr.
Frank B. Gilbreth for the following notes on how best to system-
ize a contractor's office. They were first presented in a paper,
read before the American Public Works Association in 1908:
In this paper I have endeavored to give a description of the
lessons that we learned during the years of evolution of the
OFFICE APPLIAXCES AND METHODS. ny
present system in our office. Systematizing a department, an
office, or a business, is accomplished by one, or both, of the two
following methods: (i) By efforts of the members of the organ-
ization, (2) By efforts of professional systematizers.
For the original idea of system in our office, I desire to
acknowledge my indebtedness to my friend, the late Wm. H.
McElwain, the possessor of one of the master commercial minds
of America. The success of his whole tremendous business was,
to use the words of his own statement to me, ''Due to having his
entire system in writing," Mr. McElwain's further advice was to
carry the systematization of our business as far as possible by
our own efforts before calling in the professional systematizer —
that is, to use both methods suggested above in the order given.
After a system has been put in writing and perfected along simple
lines by the men who have built up the business, it is easy for the
professional systematizer to understand instantly the methods in
use at the time he undertakes his task. He can then suggest
changes and improvements, which can be adopted with no shock
to the business.
When experts attempt to install system for a concern that
has not been systematized by its own organization, a shock is
bound to occur. If it is desired to introduce expert advice before
any attempt is made to systematize by the organization itself,
there is no such protection against shock as to take the precau-
tion of carrying on the old system at the same time that the new
system is being installed and tried out. Keep the old system in
a separate building if necessary, but keep it in operation until
the new system has proved itself, by actual use, to be superior
to the old. The expense of temporarily maintaining a duplicate
accounting department, for example, is very little compared with
the protection, speed, order, rivalry and value of actual com-
parison.
As a result of our own experience, we believe that the best
way to systematize a contractor's business is along the lines
suggested by Mr. McElwain. We believe that the fundamental
laws governing systemization are clearly defined. They can be
used and adapted to any line of business by the men in that
business.
The procedure in systematizing by the evolution method is
as follows:
Il8 COST KEEPING.
(i) Have each member of the office put in writing a de-
scription of the way he actually does his work. Not at first of
the ideal way that the work should be done, but of the real way,
the way in daily use. If an attempt is made at first to write
down the ideal way, the entire benefit of the scheme will be lost.
The rules must be historical, descriptive and no nearer perfect
than are the members of the organization. The rules must be in
such form that they can and will he obeyed without having per-
fect human beings to fill each position. These written descrip-
tions should be put in the form of rules for the next clerk below,
who needs description, instructions and guidance as to the work
he is eventually to do.
(2) After each member of the organization has submitted
his rules describing the way he actually does each part of his
work, have the entire collection typewritten. A complete copy
should be handed to the head of each department for correction
and improvement. The corrected copies should be then inspected
by the general manager.
(3) During the various inspections of the rules, it will usu-
ally develop that some members of the organization have not
been able to express their ideas well. It will also develop that
some one clerk has a talent for wording rules particularly well.
Select this clerk to revise and arrange in proper order the entire
collection of rules. If an announcement is made at the time the
rules are first written that the clerk submitting the best set of
descriptive rules will be made "System Clerk," better offerings
from all employees will result, and a higher standard will be
secured. The system clerk should see that each rule describes
the easiest way to accomplish the act that it describes. Few
people realize that a simple system that can be enforced easily
is much better than an ideal system that is difficult to enforce.
Only simple system is good system. Have the rules expressed
in the simplest, most concise manner possible.
(4) Have the revised rules typewritten again, and give a
complete copy to each member of the office force. Also distribute
notices of prizes that will be given to those who suggest improve-
ments that are adopted. We have found that $1 for each sugges-
tion adopted, and three special prizes of $2, $3 and $5 each for
the best suggestions during the month will bring in many im-
provements. Clerks will use every effort to discover improve-
OFFICE APPLIANCES AND METHODS. 119
ments not only for the prizes, but also for the promotion that
always rewards a clerk who can constantly suggest better ways of
doing work.
Our experience proves that immediately after all of the
clerks have received a complete copy of all the rules governing
all other departments as well as their own, all hands will discover
and suggest eliminating rules requiring unnecessary labor. Sug-
gestions for improvements will then come thick and fast. The
$6 boy will understand the work of the $12 boy. He will con-
sider himself lucky to fill the place of the $12 boy above him for
$9. The $12 boy will be able to do the work of the young man
who is getting $24 per week. It means a raise of pay and more
earning power for every member of the office organization. This
process will extend up to the heads of departments, who can
spend their time more profitably on new work that requires
judgment, leaving routine work to be handled by the clerks under
them.
Too much stress cannot be laid upon the importance of re-
ceiving, rewarding and incorporating suggestions from any and
all members of the organization. It encourages all clerks not
only to make the best use possible of their own experience, but
also to investigate what is going on in other organizations and
to read magazines of "Short Cuts" in business. This reading
brings the organization into sympathy with the best work of
system experts and labor saving devices, and paves the way for
the successful entry of the professional systematizer into the
office. Such reading of short cuts and improved business methods
also stimulates the interest in ''Motion Study."
This "Motion Study" is an object of particular interest to
us, and is put into practice by us on all of our work, both office
and field. It consists of observing and noting the motions used
to do any piece of work, of eliminating the unnecessary motions,
determining how the work may be done wnth the least possible
number of motions, and, finally, of reducing the necessary mo-
tions to the shortest possible distance in feet and inches.
In the office this study involves the discovery of the form,
methods, etc., that will save motions of each and every clerk.
In our office we make use of every device that we know of to
save motions. For example :
(i) "Eye saving" devices.
120 COST KEEPING.
(a) Different forms, especially manifold sheets, made of
different colored paper, the color showing- to which special desti-
nation each copy of the form is to be sent. It is obviously
quicker to collect or file, say, all the blue copies than to read the
destination directions on each sheet.
(b) Distinguishing numbers or initials on the lowxr corner
of form — T. L. (tool list), U. C. R. (unit cost report), to save
reading of the entire forms.
(c) On all typewritten letters a list of articles to be en-
closed or sent under separate cover is placed at the lower left
hand corner. This makes it needless of the mail clerk to read
the entire letter to see what is to be enclosed.
1^2) ''Hand saving" devices.
(a) Printing on forms all wording that is in continual use
to save pen motions.
(b) Several phrases or sentences on such forms as tele-
phone blanks, etc., all but one of which may be crossed out wheir
form is used.
(c) General use of self-inking rubber stamps. These save
the motions of inking on a pad. The place for the thumb is cut
off flat to save the motions of turning the stamp right side up,
as well as to save taking the eyes off the w^ork. It is attached
to a weight that will carry it back into place when it is not in use.
(3) "Foot saving" devices.
(a) Placing all files and furniture so as to have the shortest
possible distance, measured in feet and inches, for the travel of
the clerk who uses them.
(b) A definite place for every piece of paper that is han-
dled in the office both before and after it is filed.
(4) ''Memory saving" devices.
(a) Each file plainly labeled.
(b) All similar files labeled in the same sequence.
(c) Daily calendar made out ahead, an automatic mem-
ory of date of events, etc.
These are only a few of the many examples that might be
cited.
It is impossible to go further into detail in this paper. In
our business the written system for the office work has grown
into systems for the various departments. For work in the field.
OFFICE APPLIAXCES AND METHODS. 121
the written system has evolved into a field system, a concrete
system, a bricklaying system, etc.
The general benefits that are sure to come from this evolu-
tional form of system are :
(i) There is no general upheaval, nor the slightest shock
to the business. The installation of the system has cost nothing.
(2) All members of the organization are working undcr-
.standingly toward the same desired end.
(3) A corps trained on the duplicate plan system is evolved
simultaneously with the system.
(4) Clerks can be instantly shifted to accommodate the
business, for vacations, illness, promotions and immediate de-
mands of any or all departments and to sudden increase of busi-
ness.
(5) From its beginning the system will be popular with
the clerks. Every one of them profits by it. It reduces their
labor. It fits them for constant promotion, and gives them con-
tinued opportunity to win prizes. It provides places for the
advancing young man, also for the faithful routinist.
(6) Competitive spirit is always active, yet ''Team work"
is assured.
(7) The resulting system is exactly suited to the particular
office in which it is evolved, as it is the outgrowth of that office,
and its particular requirements.
(8) Growth is an integral part of the conception, and there-
fore the system will be elastic and adapted to great fluctuations
in the amount of business in hand.
After the evolutional system has been installed and is suc-
cessful, it is time to call in the professional systematizer. There
is hardly a business that is not large enough to warrant the
advice of a system expert. This expert, having made system a
life study, will surely be able to bring from his experience and
observations behind the scenes of the inside workings of fifty
offices some points that will be of great value to the fifty-first.
He will find in that office an organization to appreciate his study,
and on the alert to receive his suggestions. His improvements
will correct and improve the growing system with no resulting
check to the growth.
This is the age of System Scientific ^lanagement. Such
men as Frederick \\\ Taylor, ex-president of the American So-
122 COST KEEPING.
ciety of Mechanical Engineers, and his co-workers have done
more than install systems. They have also installed entirely
new methods of operation, founded upon lifetime study of the
fundamental laws of management. They are now ahead of their
times, but the general awakening of the industrial world is
coming. Their methods, which are the only solution of the
struggle between capital and labor, will be generally adopted
because they reduce production costs and increase wages simul-
taneously.
There are three obstacles which the man who undertakes to
systematize his office must overcome.
The first obstacle is the fear one naturally has of being
called theoretical instead of practical, of being called *'a dreamer"
instead of ''a doer." When it is realized that that man who can
manage the details of his work by putting in writing a descrip-
tion of the simplest and the swiftest routine is best fitted to
handle large undertakings in a business-like way, all such criti-
cism will die.
The second is, thinking that his system can ever be complete.
By its very nature the system of a growing business is a growing
thing. It must be constantly adapted, constantly increased, con-
stantly improved.
The third obstacle is so called "red tape," and the fear of it.
No good system is ever *'red tape." In fact ''red tape" is simply
bad system, system that has never been tackled by all the indi-
viduals of a loyal and interested organization determined to
answer the following questions:
(i) How can we simplify?
(2) How can we eliminate?
(3) How can we condense?
The whole secret of success is in a constant endeavor to
answer these questions. This constant attention can be given
only by the organization itself. The innovations of an expert
who can, necessarily, give his whole attention to the business
for a limited time only, are not to be underrated. But the best
man to keep a system going and growing is the man who is
vitally interested in the business and who has brought it to the
point where it can successfully compete with its competitors.
Order System by Means of a Card Index. — This system,
which was used by a large contracting firm, was described by
OFFICE APPLIANCES AND METHODS.
123
Mr, C. Arthur Worden in Engineering-Contracting, June 3,
1908, as follows :
Each order is made out in triplicate. The original, Fig. 26,
is mailed to the firm or party from whom the material is ordered.
At times, the list of material is too large to be put on the regular
order form and in that case the words "kindly furnish us with
material as per list attached to and forming a part of this order"
are substituted. The list is then made in triplicate, and one copy
is attached to each copy of the order.
Order No. 2510
Date April 25/08.
James Goodnow, Esq.,
143 Liberty St.,
New York City.
JOHN DOE CO.
Engineers and Contractors
N. Y. City.
Please furnish us, •without delay, the following material:
(a) 150 feet Monarch sash chain at 3 cents per ft.
(b) 10 kegs 20d wtre nails at $2.50 per keg.
Send Bill of Lading and itemized invoice to us on day of shipment.
Always put order number on invoice.
No boxing or crating paid for unless specified on order.
Ship via N. Y. C. & H. R.
Ship to John Doe Co.
F. O. B. NewYork
do Frank Miller,
Albany, X. Y.
JOHN DOE CO.
By C. A. Worden.
(Detach and return to us.)
JOHN DOE CO.. New York:
We have this day completed shipment on your order No.
foTO-ard via g^" ^- ^°;,
r^xpress Co.
.190_
., same gouig
(Detach and return to us.)
Acknowledgment Slip.
.190_
JOHN DOE CO., New York:
We acknowledge receipt of yoiir order No
^ on
and will ship from
(Give definite date of shipment.)
This order will be executed in accordance with conditions stated.
Fig. 2t3. — Order Blank.
This and the blanks shown in Figs. 27, 2S and 29 are much condensed.
The "Office and Purchase Record," Fig. 2y, is retained in
the Home Office, while the "Receiving Department" copy is
mailed to the Field Office having that particular contract in
charge.
Fig. 26, as will be noted, gives the forwarder of material
all information in regard to shipment, manner of rendering in-
voice, etc. Attached to this slip are two stubs: the first, or
124
COST KEEPING.
acknowledgment slip, is to be returned to the contractor imme-
diately, stating probable date of shipment; the second slip is
returned as soon as the order is completed, and should have at-
tached the itemized invoice and Bill of Lading.
The ''Office & Purchase Record," Fig. 2y, is printed on a
light weight card, suitable for filing in a small vertical file. The
order number, date, and name of party to whom order is given,
appear in the extreme upper left hand corner, thus giving easy
access to the record in the file when desired. In the upper right
hand corner, blank spaces are given in which are to be noted the
amount of freight, express or cartage paid by the Field Office,
date of delivery, name of party paying transportation charges
and Dartv checking the material upon receipt. This information
Order No. 2510
Date Apr. 25/08.
James Goodnow, Esa.,
14'3 Liberty Street,
New York City.
Office and Purchase Record
JOHN DOE CO.
N. Y. City.
Freight S?..'?^ Transp't'n p'd by/.O
Cartage $ .25 Date Rec'd 4/3/08
Express $ Checked by J.D.
(a) 150 feet Monarch sash chain at 3 cents per ft.
(b) 10 kegs 20d wire natls at $250 per keg.
Charge
to Doors and Windows
b to
to
Timber
Ship via N. Y.C.&H.R.
Ship to John Doe Co.
F. O. B. New York
c/o Frank Miller,
Albany, N Y.
Order completed
Bill Checked by ~
Date 4/5/08 '
Voucher No.
4/1/08
O. K.
374
Fig. 27. — Office and Purchase Record Blank.
will be noted on the Record as soon as the receiving slip is
received from the Field Office, and will be needed in checking
the invoice. In the lower right hand corner is given the item
in the cost data to which material covered by order is to be
charged, date of completed shipment, name of party checking
invoice, date of checking and the voucher number. The voucher
is very seldom used for information, as the Office and Purchase
Record will show all that is ordinarily required.
The ''cost data" to which reference is made may be described
as follows:
A book is provided in which each contract is subdivided into
various items, such as excavation, concrete forms, concrete, tim-
ber work, doors and windows, etc. Labor and material are
charged under these headings in separate columns, so that, at any
OFFICE APPLIANCES AND METHODS.
125
time, the cost to date of either or both may be ascertained, and
at the completion of the work the contractor may see not only
the total profit or loss on the job, but also how the actual costs
of the various items compare with the estimated costs.
The ''Receiving Department" copy, Fig. 28, is used on the
job in checking material when received. In all cases the freight,
express or cartage charges, if any, should appear on this slip
before mailing to Home Office. This copy when received at
Home Office is attached to the Office and Purchase Record bear-
ing same number, and filed until the invoice has been checked,
when it is attached to same, thus giving a complete record of
the transaction in the voucher.
Order No. 2510
Date Apr. 2 5 /OS
James Goodnow, Esq.,
143 Liberty Street,
New York City.
RECEIVING DEPARTMENT
JOHN DOE CO.
N. Y. City.
Freight S/..54 Transp'fn p'd hyJ.D
Cartage $ .25 Date Rec'd 4/3/08
Express $ Checked by /. D.
(a) 150 feet Monarch sash chain at 3 cents per ft.
(b) 10 kegs 20d wire nails at $2.50 per keg.
Charge a to
b to
Doors and windows
Timber
Ship via A^ Y.C.&H.R.
Ship to John Doe Co.,
F. O. B. New York
c/o Frank Miller
Albany, N. Y.
Check up all goods as soon as received,
and return this slip to Home Office at
once, using back of same for detailed
statement, if necessary.
Fig. 28. — Receiving Department Oi-der.
The order file should be provided with three guide cards,
thus:
(i) Marked "Ordered," behind which the Office and Pur-
chase Record should be filed as soon as made out.
(2) Marked ''Received." When the "Receiving Depart-
ment" copy is returned, it should be attached to the Office and
Purchase Record and filed behind this guide card, preparatory
to checking the invoice.
(3) Marked "Checked." This is a final file for the Office
and Purchase Record as soon as invoice has been checked.
In all cases cards should be filed numerically.
Section i of this file can easily be converted into a follow-up
file by putting in guide cards of a different color from the one
marked "ordered," and numbered from i to 31. Order No. 2,510,
say, was promised on the 29th. The Office and Purchase Record
126
COST KEEPING.
bearing this number is filed under the 29th and the order clerk
in going over his records on that date will find this card and
follow up the shipment.
Fig. 29 shows a card system for following up, which, while
more complicated, gives far more satisfactory results. This
Order No. 2510
Placed with James Goodnow
Date 3/25/08.
Completed A/ 1/08
Cont. No: 762
Tel. No. 2900 John
Address 143 Libeny St., N. Y. C.
Order hy C.A. W.
Correspondent Mr. Goodnow
Material Sash Cord — Nails
Followed up I 3/28 phone \ 3/30 letter \
Date acknowledgement slip 3/28
Freight Express
Shipment asked tor immediate shipment from stock
promised 3/29
Complete or Partial
Date of Shipment
** Ship'g Papers
Due at Destination
Request for Tracer
Material Received
4/1/08
4/1/08
4/3/08
V
4/3/08
Form 5. see other side for Memorandum.
Fig. 29. — Card System for Follow Up.
card may be filed in a "daily reminder" file under date of prom-
ised shipment, and all information can be noted thereon instead
of on the Office and Purchase Record.
This card explains itself.
CHAPTER VII.
BOOKKEEPING FOR SMALL CONTRACTORS.
Simplicity Essential. — Most articles and books describe
complex bookkeeping systems which are impossible for the aver-
age contractor who must depend on a moderate priced book-
keeper, or even a stenographer with a slight knowledge of book-
keeping. While today most firms in this class are still able to do
business with poor records because their small awards are ob-
tained from friendly sources or through "pull" of some kind,
competition is day by day making inroads on this field. That
these firms are aware of the danger of their position is clearly
indicated by the increased number of inquiries received by ac-
countants and engineering cost specialists regarding simple ac-
counting systems. It is with these contractors in mind that this
chapter is written.
Let us suppose that the office force of a small contracting
firm largely engaged in building work, for which we are about
to design a bookkeeping system is made up of two owners, one
of whom acts as Manager and the other as Chief Engineer, the
former attending to the business end and the latter the construc-
tion end, supervising the designing and estimating and acting
as superintendent ; an estimator who also does whatever drafting
there may be ; a stenographer who looks after the correspondence,
the files and the telephone; a bookkeeper who is responsible for
the records ; and an office boy.
With such a limited force available for the work, it is clear
that simplicity must be the keynote, even if the results obtained
are not theoretically accurate at some points.
Partnership agreements often contain a clause which states
that each partner is to receive a salary, naming the amounts.
Although this makes no difference in the total amount received
from the business by each partner, it aids in making up the cost
records; and we will assume that such an agreement has been
entered into by the partners of the business under consideration.
127
128 COST KEEPING.
For the sake of clearness we will first outline the various
accounts to be kept, then discuss the methods of gathering the
data and finally describe the method of distribution.
Fundamental Divisions of Cost. — In order to make the
discussion clear, Chart No. i has been inserted. The subdivisions
shown are only illustrative, and are not complete, since it would
be futile to attempt to make a complete outline that would apply
to any contracting firm. Keeping books is writing the history
of business transactions; hence, it is obvious that no outline of
the "history" can be made until the ''events" are known. Even
though two firms are in the same line of work, these "events"
are never of quite the same nature in both concerns. Therefore,
it is clear that before an outline of the records of a concern can
be made, that particular concern must be studied to learn the
nature of all its transactions. For this reason no general dis-
cussion of the methods of keeping accounts for any line of busi-
ness can hope to be more than thoroughly suggestive.
Every source of expense to a contracting business contrib-
utes to the total cost of the contracts carried by the firm. A
certain proportion of the Office Rent, the Legal Expenses in
connection with law suits, the cost of making unsuccessful ten-
ders, etc., are just as much a part of the cost as wages paid to
carpenters and bricklayers. To allocate these various costs seems
a difficult problem, but the first step is simple, for each item can
be readily classified under one of the following two divisions :
1. Direct Expense.
2. Overhead Expense.
Direct Expense includes all expenditures that pertain to only
one contract, and that can be charged to that contract without
subdivision or apportionment.
Overhead Expense includes all expenditures that pertain to
all the contracts carried, and that cannot be charged to the indi-
vidual contracts without subdivision or apportionment.
Analysis of Direct Expense Account. — The Direct Ex-
pense Account is divided into two parts:
1. Field Expense.
2. Sub-Contra:ct Expense.
Field Expense includes all items which can be directly
charged to the work in the field.
BOOKKEEPING FOR SMALL CONTRACTORS.
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130 COST KEEPING.
Sub-Contract Expense includes all amounts paid for work
done by sub-contractors.
Under Field Expense we have four subdivisions :
1 . Labor.
2. Materials.
3. Supplies.
4. Miscellaneous.
All expense for labor (except when sub-contracted) em-
ployed in the field is charged under Labor.
Expenditures for materials which are found in the com-
pleted structure, and which are paid for according to the con-
tract, are charged under Materials; e. g., Cement, Sand, Crushed
Stone, Bricks, etc.
Supplies include all such items of material as are necessary
to the carrying on of the work, but which are partially, or wholly,
destroyed in the process of construction; e. g.. Oil, Waste, Coal,
Rope, Hose, etc.
General items of expense which do not come under any of
the first three classifications, but which can be directly charged
to the Field Account of a contract, come under Miscellaneous;
e. g., Plant Rental, Plant Depreciation, Telephone and Telegraph,
Postage, etc.
Analysis of Overhead Expense Account. — There are two
main divisions under Overhead Expense :
(i) Office Expense.
(2) General Miscellaneous Expense.
Office Expense includes all items which cannot be charged
directly against the field and which are due to maintaining an
office.
Three subdivisions can be made under Office Expense,
namely :
( 1 ) Labor.
(2) Supplies.
(3) Miscellaneous.
All expenses incurred for Labor through the office force,
including everybody housed in the office from the Manager down
to the Office Boy, are classed under Office Labor. In the case
of a large business it will pay to subdivide this account rather
minutely, the degree of analysis depending upon the magnitude
of the business. In a small firm, where a man is called upon
BOOKKEEPING FOR SMALL CONTRACTORS. 131
to do several classes of work, time of the individuals will have
to be divided and charged to several classifications. This mat-
ter will be taken up again later.
Supplies include all expenditures for materials used by the
office force, and include such items as Engineer's Supplies, Book-
keeper's Supplies, Stenographer's Supplies, etc.
Expenditures which are due to the maintenance of the office
and which cannot be classed under either Labor or Supplies, be-
ing general in nature, are charged under Miscellaneous Expense.
General Miscellaneous Expense includes all expenditures
which are so general in nature that it is impossible to charge
them against either the Field or the Office and which are due to
the maintenance of the business in general.
The various items of the subdivisions under Field, Sub-
Contract and Office Expense are divided into three classes :
(i) Management Costs.
(2) Maintenance and Incidental Costs.
(3) Direct Costs.
Management Costs include all expenditures for labor doing
work of a managerial nature, involving discretionary powers.
Maintenance and Incidental Costs include all expenditures
incurred by the Office and Field for labor, material, supplies and
miscellaneous items necessary to the maintenance of the business,
but incidental as regards the actual construction.
Direct Costs include all expenditures for labor, materials,
supplies and sub-contracts directly necessary in carrying out the
main contract.
Attention is called to the fact that the Total Expenditures
are equal to the Total Construction Costs. Hence, when unit
costs are worked out, their total should check reasonably close
with the difference between Total Expenditures and Sub-Con-
tracts, or they are too much in error to be of use. Just what
"reasonably close" means depends on the class of work and on
the elaborateness of the system of accounts, which in turn
depends on the size of the business. On one large contract the
total of the unit costs as made up from distributions checked
within 1% of the costs according to the books. This work was
done by a large firm with a newly installed cost department.
Gathering Data. — Field Labor data for Field Labor ex-
pense come weekly from the Timekeeper in the form of the
132
COST
KEEPING.
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Form 1.
BOOKKEEPING FOR SMALL CONTRACTORS.
133
Weekly Pay Roll. Form I is that used for the Construction
Labor. For Field ]\Ianagement and Incidental Labor the same
form is used, with the exception that the words printed at the
heads of the sheets are the names of those accounts.
It will be noted that the week ends on Thursday night. This
is to give the Timekeeper Friday and Saturday in which to make
up his accounts and get his money ready for payment on Satur-
day night. Anyone who has been through those week-end periods
knows that this is not allowing any too much time.
Contract No.. •
115
P. R. V. No..
Weekly Pay Roll Voucher
Class of Work . M^.^l^^.Z^L
Date....Z^^: ^
510
193
Name
Chas. Glass
No.
Fri.
Sat.
Sun.
Mon.
Tues.
Wed.
Thur.l Total
Hours
Rate
Amount
s
4
—
7
—
-!- ..
0.55
10 45
-DOLLARS
Received of the REAL ESTATE CONSTRUCTION COMPANY.
loo
Chas. Glass
Workman's Signature
Correct >^.^.^..5:..?.^^f^.
Time Keeper
Approved i^.:..?:..M!n"^.....
Superintendent
Form II.
The men are listed according to trades, and the total amount
paid for the week to each trade is entered in the 'Trade Total"
column on the line opposite the last name in that list. When
starting to list a trade on a sheet partly filled, take a new sheet
if there is not room for the whole trade in the remaining space.
When a man is discharged and paid during the week a
voucher such as shown by Form II should be obtained and the
voucher number entered in the "Remarks" column of the weekly
pay roll. (See Form 11.)
All of these forms should be made up into books of conve-
nient size with alternate pages printed on tissue paper, and a
134 COST KEEPING.
carbon sheet used to make a copy on the tissue. The original
sheet is perforated near the binding so that it can be readily torn
out and forwarded to the Office. A copy of all records is thus
left in the book for reference on the work.
Later, under the discussion of distribution, the further
handling of these data will be taken up.
Office Labor. — The time of the owner who attends to the
business end will be divided between soliciting new business, pur-
chasing materials, interviews with owners and architects, legal
matters and various other things too numerous to mention. To
be able to tell just how much each of these items costs the busi-
ness might be very interesting, but the value of such data would
not justify its expense and trouble in collecting. Hence, his
wages will be charged each month without being analyzed.
In the case of the other owner it would seem advisable to
distribute the time over Estimating, Designing and Superintend-
ence. The division is simple and inclusive; and the information
gained is of value, because it helps to keep the constructive ac-
counts of Superintendence and Estimating accurate. As the
major part of the time will be charged to Superintendence, the
additional work will be slight.
Monthly wages paid to the Estimator, Bookkeeper, Stenog-
rapher and Office Boy can be readily charged to their respective
accounts each month.
Field Materials. — Wise purchasing of material is as de-
pendent upon effective Material Accounts as efficient management
of labor is on Labor Accounts. The partner whose duty it is to
purchase materials might succeed in getting good prices, but
without some system he would be unable to follow up each pur-
chase,to see that the quality and quantity that he contracted for
were delivered, that the materials were billed but once, and that
the price as billed was the same as the agreed price. But the
average man would not be able even to get good prices, because
successful purchasing, like the letting of contracts, is not a ques-
tion of picking the lowest bidder, but of carefully comparing
values. Good judgment is a prerequisite; and with such a vast
amount of detail, it is impossible to bring good judgment to the
problem without some aid to the memory. For example, if coal
is to be purchased, some of the questions which the purchaser
should be able to answer are :
BOOKKEEPING FOR SMALL CONTRACTORS. 135
Of whom have we purchased coal before ?
What were the prices ?
Was the quahty of coal delivered satisfactory?
Was the quantity as ordered?
Was the service prompt ?
With such an important item as coal it may be easy to re-
member the leading facts. But there are thousands of items to
be dealt with, and no one is able to remember the detail necessary
to good judgment in purchasing in such a wide field. The return
in savings on purchases will more than pay for the extra cost of
keeping what the small contractor may consider too elaborate a
system of Material Accounts.
Purchasing. — First, let us outline the various steps in
purchasing; and in order to make the outline general, let us
take the case in which the Purchaser must be notified of the need
of material. For example, the hoisting engineer reports to the
Timekeeper that he needs oil for his engine. The latter makes
out a Purchase Requisition for the oil, — which is a notice that
certain quantities of that material are needed, — and sends it to
the Purchaser after it has been signed by the Superintendent.
On receipt of the Requisition the Purchaser selects a Dealer and
issues a Purchase Order for the oil. A copy of this is sent to the
Timekeeper, who checks off the items when the material is re-
ceived. By means of a Receiving Slip he notifies the Purchaser
that the goods ordered have arrived. In general this is the
method of making purchases.
Stock forms for the work outlined above can be purchased
of firms dealing in office records. They will serve the purpose
quite well; but, of course, it is always more satisfactory to have
special forms printed w^hen possible, because the stock forms are
of necessity general and cannot meet the special demands peculiar
to the business.
Purchase Requisition. — Purchase Requisitions should give
such information as Contract Number, Requisition Number and
Date, Point of Delivery, Quantity and Description of Material,
Proposed Use, Date Wanted, Timekeeper's and Superintendent's
Names. Also, space should be provided for the Purchaser's
record of the firm from which the material was ordered and the
number of the Purchase Order. They should be made in dupli-
cate so that the copy may be kept on file at the job. Until a copy
136 ^ COST KEEPING.
of the Purchase Order arrives this duplicate serves as a reminder
that the materials needed have not yet been ordered. If, for any
reason, the order is not placed promptly, the delay will be shown
by the Requisition File, and a note of it made in the Daily Letter
will correct the fault. This is a letter to the Office written each
night by the Timekeeper and signed by the Superintendent, and
should contain a statement of progress made during the day and
any items of special interest to the Office.
Purchase Order. — Purchase Orders should give such in-
formation as Contract Number, Order Number, Date, Purchase
Requisition Number, Dealer's Name, Place of Delivery, Proposed
Use of Materials, Method of Shipment. They should be made
in triplicate. The original goes to the Dealer as his authority
for shipment, and gives him the identifying number to place upon
his shipments and bills. In cases where the order arises out of
a requisition, as in the case cited above, the duplicate goes to
the department which made the requisition to give notice that the
materials needed have been ordered. This leaves the triplicate
for the Purchaser's record. It is usual to make these three
copies of different colors, so that the department from which a
paper comes may be told at a glance. Thin paper is used for the
original and duplicate, and the triplicate is on a regulation card
for filing. Hence, all three copies can be made at one time by
the use of carbon sheets. By having thirty-one numbers printed
horizontally along the top of the card the day of promised deliv-
ery may be indicated by attaching an adjustable tab showing the
month at the point where the date of delivery is printed. This
enables the Purchaser to tell at a glance what orders are over-
due, and thus avoid delays.
It is not advisable to put the price on the Order. In the
case of most of the small purchases the price is not known, the
Purchaser relying on the past fair dealing of the Dealer for a
reasonable figure. Before he pays for the goods he will, of
course, determine whether the price is right or not ; but if he
waited to find out the price before ordering, his work would be
seriously delayed to the detriment of the business.
Receiving Slip. — Receiving Slips should give such infor-
mation as Contract, Order and Receiving Slip Numbers, Date of
Receipt of Materials, Shortage or Mistake, Quantity and De-
scription of Materials. They should be made out in duplicate.
BOOKKEEPING FOR SMALL CONTRACTORS. 137
the original going to the Purchaser to notify him of the receipt
of the materials that he ordered, and the duplicate remaining on
the job. In case several shipments are necessary to make up the
order, each separate delivery should be immediately reported on
one of these slips ; and on receipt of the final shipment, a note to
that effect should be made on the slip reporting the receipt of
the materials. As the several Receiving Slips come in, the Pur-
chaser attaches them to the copy of the Purchase Order which
authorized the shipment of the goods received. When the final
Receiving Slip comes in he records on the Order the prices that
have not already been recorded and **0. K.'s" it ready for check-
ing the bills. If the Dealer does not deliver promptly the Pur-
chaser will be notified of the fact by the Purchase Order which
will be in his file of unfilled orders without a final Receiving Slip.
Duplicate Bills. — Duplicate bills bearing the Purchase
Order number may be demanded of vendors in certain cases. One
is filed alphabetically and the other numerically, so that a bill can
be found as readily when only the number is known as when
the name of the vendor is known.
Combined Purchase Requisition and Order. — There is a
modification of the purchasing system outlined above which, if
the conditions are favorable for its adoption, will save consid-
erable time. The Purchase Requisition and Purchase Order are
combined into one sheet, so that when the Requisition comes to
the Purchaser he has simply to fill in the name of the Dealer.
By the use of carbon sheets the Timekeeper makes five copies.
One of these copies remains in the book for reference on the
job and the other three, with the original, are forwarded to the
Purchaser. The latter enters the name of the Dealer on the four
sheets by means of carbon paper and sends the original to him
as his authority for the sale. One of the copies goes back to the
source of the demand to give notice of the purchase, and the
other two copies remain with the Purchaser for alphabetical
and numerical filing. As the materials purchased arrive. Receiv-
ing Slips are sent to the Purchaser, and when the final shipment
is received, the copy of the Order sent to the job by the Pur-
chaser is returned to him with a note stating that the final
delivery has been made and calling attention to faulty material
or shortages.
138 COST KEEPING,
Price Records. — As these accounts are designed for a
small contractor, it is safe to presume that he confines his activi-
ties to a few cities, or even to one city. If this is the case, his
purchases are made among a certain limited field of dealers.
Hence, it will pay him to keep record cards showing the com-
parison of quotations on different staple articles. In this way he
will be able to determine accurately the best place to purchase.
The quantity and quality of each class of Construction Ma-'
terials will be determined from the drawings and specifications
by the engineering department, who will inform the Purchaser
as to what is necessary. These materials offer the big oppor-
tunity for saving in purchasing and will have to be handled by
the Purchaser himself. The method of purchasing has already
b&Gsi described.
Field Supplies. — Many of the purchases of Construction
Supplies will find their origin in a Purchase Requisition from the
job. But it is necessary, in order to avoid great loss through
delays, that the Timekeeper be authorized to make out Purchase
Orders for such supplies as Nails, Rope, Brooms, Hose, etc., for
immediate delivery. All such Orders should bear a distinctive
mark and a serial number and be approved by the Superintendent.
The method is the same as already outlined for regular pur-
chases through the Purchaser. In this case, however, a copy
of the Order goes from the job to the Purchaser, instead of
from the Purchaser to the job.
If the contract is very large it will pay to maintain a Store-
room on the job, with a Storekeeper in charge. He should keep
as careful records of the materials received and disbursed as the
work will allow. This in itself is a topic for elaborate dis-
cussion and space cannot be given to it in this chapter.
Tool Record. — A Tool Record of some kind should be
kept by every contractor no matter how small the job. Even if
it is only an approximation to a correct record it will serve a
good purpose, for if there are signs that records are being kept,
the workmen will not know how accurate they are and will'^esi-
tate to appropriate tools for fear that the records will show their
misdeeds. Just a simple record charging tools sent to the job
and crediting those returned to the Storehouse or transferred to
another job will save a great deal of money. If a Purchase
Requisition comes in calling for tools of a certain sort and the
BOOKKEEPING FOR SMALL CONTRACTORS. 139
Tool Record shows that a normal number have already been
supplied to the job, the fact can be called to the attention of the
Superintendent and a reason demanded for the necessity of such
a large supply.
Office Supplies. — Whether the firm be large or small, it
is advisable to leave the purchasing of drafting and stenographic
supplies to those departments, vi^ith the occasional supervision of
the regular purchasing head. No one knows so well as the per-
sons doing the work in these departments just what particular
kind of material is needed. Also, when special technical knowl-
edge is of value in making a purchase it is wise to allow the
proper department to place its own order. But for every pur-
chase there should be a Purchase Order issued by the Purchaser
or somebody authorized by him.
Plant Depreciation. — Whether a contractor's plant is in
use or in storage it is depreciating in value. Even the moment
an article is purchased its value drops, because the article imme-
diately becomes second-hand. If the loss in value of plant due
to depreciation is not taken out of the gross profits and either
put back into the business or used to establish a fund with which
to purchase new plant when that now in use must be discarded,
the capital is being impaired and the business ruined.
Until recently it was customary to charge out a certain
percentage of the value of the plant at the end of the year in
the Profit and Loss Account ; but this method does not give the
correct cost of each separate piece of w^ork, because each job
has the use of certain plant and should bear a proportion of the
total depreciation.
One modern method of handling this account is to credit
the Equipment Account and charge an Equipment Depreciation
Suspense Account, with the estimated amount of depreciation
for the coming year. Then the value of the business for the
coming year is estimated, and as each contract is completed it
is charged with a part of the total "depreciation for the year
determined by the ratio of the value of the contract to the esti-
mated business for the year, and the Equipment Depreciation
Suspense Account is credited w^ith the same amount.
This scheme presents several difficulties. In the first place,
the amount of plant that will be carried during the year is un-
known, and hence the per cent, for depreciation cannot be accu-
I40 COST KEEPING.
rately determined. Also, the amount of business which will be
done during the coming year is an unknown quantity. Again, if
you charge a certain proportion of the depreciation on all plant to
a contract, whether the total of that proportional part of the
entire plant was used on the job or part was used and part was
in storage, the amount of depreciation which you charge to a
contract this year when business is dull will be quite a different
amount from what you would charge for the same piece of work
next year when all your plant is in use. In other words, if this
method is used the records will lose their value for comparisons.
It may be argued, as above, that it costs a contractor the
total amount of the depreciation to maintain his business, and
that as he does so much business with that amount as one of the
items of expense, each part of the business done costs its propor-
tion of the total depreciation. Nevertheless, what it costs a
contractor to maintain his business and what it costs him to per-
form the contracts of the year are quite different. For example,
if he obtained no contracts at all for a year he would still have a
considerable item for Equipment Depreciation, and this would
have to be charged to maintaining his business. When his plant
is not all in use, that part of the depreciation which is on account
of plant in storage is a part of the expense of maintaining his
business and not a part of the cost of performing the contracts
in hand. The reason why some advocate this proportional method
is that they confuse the point of view; they look at the question
from the point of view of an outsider, rather than that of the
contractor. An outsider knows that a contractor must at least
make enough on his contracts to cover the total expenses, and
that if work is being done the owner is going to help to pay
those expenses. Thus, to the outsider, a ratable proportion of
the expense for depreciation will be charged to the work being
done for him, and it will be ; but the contractor wants his ac-
counts to tell what it costs for the depreciation of the plant
actually used in the completion of the contract, so that the figures
will be useful in estimating on future work; also, what it costs
to carry idle plant in order to remain in business.
This information can be readily obtained if the proper
method is followed. Some record of the equipment on the work
and in storage must be kept in any event. Also, a schedule of
depreciation rates for the different items of plant must be made
BOOKKEEPING FOR SMALL CONTRACTORS. 141
out, if anything like an accurate charge for depreciation is to
be made. If the monthly depreciation rate is entered opposite
each plant charge to the different jobs and storage accounts,
this can readily be multiplied by the time during which the item
of plant remains charged and the amount of depreciation entered
in the column next to the rate. The total of the amount column
can then be charged to the job in case the plant is in use, or it
can be carried into a Profit and Loss Account in case the plant
is in storage. This method is even simpler of operation than the
first one described.
It is, of course, obvious that if plant is carefully repaired
its life may be indefinitely extended, and hence the rate of depre-
ciation lowered. Just how much a certain piece of plant will
be repaired cannot be predicted ; but if we should credit out the
cost of all repairs except those due to accidents, unforeseen
break-downs, etc., against the charges for depreciation, we would
practically charge off depreciation at this modified rate. If we
charge depreciation at some arbitrar}^ rate and then also charge
the business with repairs which counteract the effect of deprecia-
tion, it is clear that we are overloading with expense, because we
are charging depreciation at an excessive rate. But there are
so many difficulties in separating the expenses for repairs into
those that should be credited i^ the Depreciation Account and
those that should be charged against Repairs, that it seems better
for the small contractor to charge all against Repairs. In
handling the account in this way he is, at least, on the safe side
financially.
Interest on Plant. — Contractors doing Avork on the cost-
plus-a-fixed-sum or the cost-plus-a-percentage, basis are anxious
— and justly so — to include among the items of cost the interest
on the money invested in the plant used on the work. By fol-
lowing the usual method of simply charging off among the
Overhead Expenses a certain percentage of the total capital as
interest, the interest on the money invested in plant is finally
charged against the several contracts because it swells the per-
centage charge for Overhead Expense. But the amount which
is charged to each job is not based on the ratio between the plant
used on the job and the total plant owned by the contractor;
hence the charge may be unjust and open to objection on the
part of the person for whom the work is being done. If it is
142 , COST KEEPING.
true in this case, it is also obvious that the contractor doing
work on the ordinary contract basis is not arriving at its true
cost if he follows this method of charging interest.
If a column is provided next to that for depreciation in the
scheme outlined above for handling Depreciation, the charge for
interest can be entered as easily as that for depreciation, and the
total charged off against the job.
Interest on capital in other forms necessary to the business
will have to be charged off through Overhead Expense. The
amount of this charge will be equal to the difference between
the interest on the total capital and the total of the plant interest
charged to the several jobs.
Electricity Purchased. — In case steam and electricity are
bought from outside concerns we will have bills coming in for
steam and electricity in addition to those for water. A note of
the reading of each meter should be made periodically on a job
Purchase Order and forwarded to the main office as if a purchase
had been made.
Employees' Insurance. — Insurance on employees is fig-
ured on the weekly pay roll, and a Purchase Order should be
made out for the amount when the pay roll comes into the office.
Timekeepers' Bonds and all other items of expense of a similar
nature, the amount of which is definitely known before the bills
come in, can be handled in the same way. When the bills are
received they can thus be checked in the same way as for pur-
chases, and there will be no danger of paying the same bill twice.
Miscellaneous Office Expense. — The items that go to
make up the Miscellaneous Expense Account are comparatively
few in number. Their nature is such that they do not lend them-
selves to the methods already outlined for collecting items of
expense. As the bills come in for Rent, Telephone and Tele-
graph, Insurance, etc., they are referred to the proper persons
for their "O. K.," and a glance at the account books, contracts,
leases and other papers will establish the justness of the claim.
Such small items as Postage and Car Fares can best be
handled through a Petty Cash Account. A certain amount of
cash, to be determined by the previous experience of the busi-
ness, is turned over to one in charge of this account and is
charged on its records. All expenditures are credited to the
account and vouchers obtained. Either periodically, or when
BOOKKEEPING FOR SMALL CONTRACTORS. 143
the cash on hand reaches a certain low figure, the vouchers are
turned in and cash to the amount of their total paid into the
Petty Cash Fund. This amount plus the cash on hand should
always equal the original amount assigned to the account.
Sub-Contracts. — The amount of expense due to parts of
the main contract being sub-let can, of course, be obtained from
the contracts.
General Miscellaneous Expense. — What has been said of
the items under Miscellaneous Office Expense applies equally well
to those found under General Miscellaneous Expense.
Distribution of Expenditures. — We have now described
the various accounts and discussed the methods of gathering the
data for them. But only a small percentage of the value of these
data could be realized if the accounting work were dropped at
this point. It still remains for us so to group and arrange these
data that they will show at a glance the expense of the different
divisions of the work.
Columnar ruled Distribution Sheets afford the best solution
of the problem of distributing expenditures. (See Form III.)
These are simply sheets headed with the names of the general
accounts to be charged and ruled with vertical columns for the
amounts to be entered under the subdivisions of the general
accounts. At the extreme left hand side is a column for the
date, the smaller column to the left of each amount column is
for the number originally put on the Purchase Order, and the
very narrow column to the right of each amount column is for
tick marks in checking.
In the following Schedule for Distribution of Expenditures
the items found in the second subdivisions and marked (i), (2),
(3), etc., will be the headings for distribution sheets; e. g., Field
Management, Field Incidental, Construction. Items found in
the third subdivisions and marked (a), (b), (c), etc., will be
headings for the columns ; e. g.. Superintendent, Assistant Super-
intendent, Mason Foremen, etc.
When a bill is checked and ready for payment it should show
on its back the total expenditure distributed over the various
items of which it is composed. By using a system of symbols,
such as shown to the right of the schedule on page 145, Ave are
able to designate with little labor both the account to which an
item should be posted and also its location in the records.
144
COST KEEPING.
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BOOKKEEPING FOR SMALL CONTRACTORS.
145
SCHEDULE OF DISTRIBUTION OF EXPENDITURES.
-Direct Expense.
(A) Field Labor.
(1) Field Management 115-FF
(a) Superintendent 115-FF-l
(b) Assistant Superintendents 115-FF-2
(c) Mason Foremen 115-FF-3
(d) Bricklayer Foremen 115-FF-4
<e) Carpenter Foremen 115-FF-5
etc.
(2) Field Incidental 115-FI
(a) Time Keeper 115-FI-l
(b) Night Watchman 115-FI-2
(c) Day Watchman 115-FI-3
(d) Water Boy 115-FI-4
etc.
(3) Construction 115-FL
(a) Masons 115-FL.-1
(b) Bricklayers 115-FL-2
(c) Carpenters 115-FL.-3
etc.
(B) Field Materials.
(1) Construction 115-FM
(a) Lumber 115-FM-l
(b) Cement 115-FM-2
(c) Sand 115-FM-3
(d) Crushed Stone 115-FM-4
(e) Brick 115-FM-5
etc.
(C) Field Supplies.
(1) Construction 115-FS
(a) 115-FS-l
(b) , 115-FS-2
(c) 115-FS-3
(D) Field Miscellaneous Expense.
(1) Incidental 115-FX
(a) Photographs 115-FX-l
(b) Insurance 115-FX-2
(c) Plant Rental 115-FX-3
(d) Plant Interest 115-FX-4
(e) Plant Depreciation 115-FX-5
etc.
(E) Sub-Contracts.
(1) Construction 115-FU
(a) Roofing 115-FU-l
(b) Excavation 115-FU-2
(c) Plumbing 115-FU-3
etc.
—Overhead Expense.
(A) Office Labor.
(1) Management CD
(a) ^lanager OD-1
(b) Chief Engineer OD-2
(c) Estimator OD-3
(d) Book Keeper OD-4
(e) Stenographer OD-5
(f) Office Boy OD-6
etc.
(B) Office Supplies.
(1) Incidental OS
(a) Engineers' Supplies OS-1
(b) Book Keeper's Supplies OS-2
(c) Stenographer's Supplies OS-3
etc.
(C) Miscellaneous Expense.
(1) Incidental OX
(a) Telephone and Telegraph OX-1
(b) Postage OX-2
(c) Rent OX-3
(d) Traveling OX-4
etc.
(D) General Miscellaneous Overhead Expense XX
(a) Charity XX-1
(b) Insurance XX-2
(c) Interest XX-3
(d) Advertising XX-4
(e) Legal Services XX-5
etc.
146 COST KEEPING.
Hence once the distribution has been written on the back of
the bill, the. remaining work is merely mechanical ; for, by
simply glancing at the back of the bill, the bookkeeper is able
to turn immediately to the column in which the amount is to
be entered.
In this system the first number is that of the contract to
which the charge goes. Of course, this number will not appear
in the symbols of the accounts under Overhead Expense, as these
are not directly chargeable to the individual contracts. The
method of handling these accounts will be made clear when we
come to discuss the Profit and Loss accounts. Following the
contract number are two mnemonic symbols which show the sub-
division of the accounts under which the item comes, and the
distribution sheet on which it is to be charged. The number
following indicates the column in which the amount to be charged
to the sheet should be entered.
To illustrate, let us suppose that a bill has come in for —
200 ft. ^ in. wire rope, at 10c $2^.00
50 lbs. "Slip Easy," at 3c 1.50
50 window weights, at 15c 7.50
$29.00
On the back of the bill the bookkeeper would write :
115-FS-3 $21.50
115-FM-12 7.50
$29.00
When he was ready to post these amounts he would turn to the
Field Supplies Sheet for Contract 115 and enter $21.50. Then
he would post $7.50 in column 12 of the Construction Material
Sheet for Contract 115. The accounts with Field Supplies and
Construction Materials are subdivided, so as to give data on the
various supplies and materials. Subdivision of this kind depends
entirely on the particular needs of the work, and the business
of each firm has to be studied before they can be made.
From week to week, as the pay-roll statements come in from
the Timekeeper, the Trade Totals are transferred by the Book-
keeper to their respective summary sheets, as shown by Form
IV, page 147. After each entry the total to date is written in
small figures with red ink under the entry. The Trade Totals
for the week are added and the result placed in the Weekly Total
column. This amount is then added to the Grand Total for last
week, which gives the total cost to date. This method of handling
BOOKKEEPING FOR SMALL CONTRACTORS.
147
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1
148 COST KEEPING.
the accounts makes it possible to tell on Monday morning how
much has been expended on any contract for Construction, Inci-
dental and Management Labor up to the preceding Thursday
night; it tells how much these items cost for any week; and it
gives the total amount paid for any single item of labor for any
week, for any number of weeks, or to date.
On the Sub-Contract Distribution Sheet a column is assigned
to each contract. As payments are made for the value of the
completed work less a percentage, the net amounts are entered
in their respective columns. The total amount of the contract
is entered in the heading of the column. Knowing the percent-
age, it is an easy matter to tell at any time how a contract stands.
To those who are inseparably attached to debits and credits this
may sound childish because of its simplicity; but it is a very
practical method in use on large contracts.
Summary Sheet. — Every month the totals from distribu-
tion sheets of each contract are posted to their respective Sum-
mary Sheets. Column headings for such sheets are shown by
Form V", page 144. By writing the totals of each column in
small figures under each entry we are able to read the totals to
date for each column as well as the monthly totals.
Profit and Loss Accounts. — As stated before, it is im-
possible to charge the items under Overhead Expense directly to
the contracts. If we knew how much business we were going
to carry during the year we could charge off against each con-
tract a proportion of the Overhead Expense determined by the
ratio of the contract price to the total amount of the year's
contracts. Unfortunately there is no way of determining this
unknown variable. And even if we could, the result obtained
by the method just outlined would not be correct, because some
of this expense is due to the contracts handled and some to main-
taining the business. Should no contracts be carried for a year,
the entire amount of this expense would have to be charged
against maintaining the business, for there would be no contracts
to charge it against.
The only way to handle the Overhead Expense Account is
to close it into a Miscellaneous Profit and Loss Account. Depre-
ciation of plant in storage should also be closed into the account.
This account will show a big loss, as the only credit will be
Discounts Gained and some small miscellaneous items.
BOOKKEEPING FOR SMALL CONTRACTORS. 149
Field and Sub-Contract Costs are added together for each
contract and these totals closed into a Contract Profit and Loss
Account. In this case the credit side will be large and a big
gain will be shown, which should more than offset the loss in the
other account.
Finally, these two Profit and Loss Accounts are closed into
a Surplus Profit and Loss Account, which shows the loss or gain
for the month.
In making up the unit costs as the work progresses, a certain
percentage of the Field Costs can be added for Overhead Ex-
pense. The percentage for this approximation can be determined
from the previous experience of the business.
It would be necessary to devote an entire book to the subject
of contractors' accounts in order to treat of it fully. Even with
such an amount of available space, the discussion could not hope
to be more than suggestive, because each individual business
must be studied in order to design accounts to meet its particular
needs. Hence, it is clear that this short chapter is only an out-
line. Many points have been barely touched upon and some have
been omitted altogether, but if the discussion has made it clear
to the small contractor how he can improve his accounting work
it has accomplished its purpose.
CHAPTER VIII.
MISCELLANEOUS COST REPORT BLANKS, AND SYS-
TEMS OF COST KEEPING.
Following the sample cost report cards given in the fore part
of this chapter will be found reprints of a number of articles de-
scribing various cost keeping systems.
Locat/oi St
/Vl
l^f" f^noman
Co/^s/rocf/o/? Ser//ce Co.
Confracf * ^c
^fipam 6/7oye/ fr'ecomf.
IVo&'A. \mtk Oone. Hours. Va^e. ffoars. ff^Te. ^^^^- /f/77/a. Costs
E^/neef
CTrcf/ismai
fyricrrf^n
P^tirrtert
B/jfnAxn^i/^
Irtb/denitii
V/alSr^u^^ L
S/&jL
7br^/
lo_
JO
/o
/'/z> Z^ CUy^fSL a,t^e>o^ cJdZt^'-^it^
.^o
•^P
j£o_
./J-
^,cu.
■P'Co
-T^.^O
/(i.060
'9±l_
ocC
,00 £.
00^4-
00 €
,009
.00 g
A^/r»V> /f M? a/ <y>ao«/y?/ h^Oc^r^^ Qfjp. nf BcK^ksf / <y.
if/atfh cf 0ra&ar
ifF cf MoY'oe
/^A<3tom fraak at tyfy/ch mff't/ </<fmfra
ToTia/ /trGf marfsc/cfp.
■0/?/<gy/r, From &l.
cr«gtf/gg
^UrX^^^'Jf^
/ OOP
^
Cos/ c/seu^
J2U^
iV<9S&
s^
Fig. 30.— Daily Report, Steam Shovel.
As previously explained, it is rare that a report card for
any given class of work will exactly meet the requirements of all
contractors doing that class of work. Hence, the report cards that
150
MISCELLANEOUS COST REPORT BLANKS.
151
follow are intended to serve merely as guides. Regarding the
cost keeping systems, however, there are many features that may
be profitably adopted in their entirety by other contractors.
Hence we have deemed it wise not to condense the original
articles.
A Cost Keeping System and Its Application to Street
paving.* — The acccompanying illustrations show the set of
Locaf/or?
Cor?6frucfyor7 dem'ceCo.
Ccnfmct *
Dump Train ffecon^.
lYcafher Oatt
//?^ yYis/rjhr cf sh^fhf*.
Triip
(jeft^ho^f
Lefi^ Oe^njp
BnaM-^fTf^rj
cars Tr//o
Leff Shorts} Is^OcffTjp
En/^in/i jns^xrcf^^ Ay
jg^/fe
Repairs /Togoteo^-
Coniiirien ^ fsn^irtA
Crirs
7h3ck
Lan^^ ^ h3u/
r>%^/ /A!r^^
nIL
ki&as2& Ofhcr ^-wppIi'cB-
A/a. n/^dffrs ux^^ Cap, of* cor ^t^^r rrf Qferf^jycar.
Fig. 31.— Daily Report, Dump Train.
blanks used by Kaumeier Bros., general contractors, Port Huron,
Mich., for the purpose of keeping records of their paving work.
Figure 58 shows a blank used for a daily curbing report. This
work is always in charge of a separate foreman and consequently
a separate report is made. Figure 59 shows the blank used for
*Engineenng-Contracting, June 10, 1908.
152
COST KEEPING.
a daily time sheet. Stiff folders, with a loose binder so that the
cover folds back straight, are used to hold these blanks. The
blanks are taken out by the foremen onto the work, and when-
ever a man is changed from one class of work to another the
foremen simply mark the time under its proper classification,
and when the blank is turned in at night the number of hours
worked is put on in ink, as shown in columns i and 2 of Fig.
Consfrac/'/o/j dem'ce Co.
Confracf *
B/aof/'/rq.
6a/9^ Af^. Locatton
H/eafher
/f?
If^orJf.
fhrcman.
Loae/ers.
C/eon if Holes.
Catr/if Bjwa/i
Cleaning Up'
To-ha/s
l/Votk Done
y«7%
Oafe
Total
Tott /
Untt.
Cos, "y.
NfHo/es /ttaefmefi^daplh
ffind of fbyyi^jer- % Jf m&ke <f ^/noun/-
Nf of Hojgs <sprunQ
Exp/oc/ers
MnclSf/V?us^
McfTens/ necc/ec/ and ^han
SuppJ/es
hC/nd of fpioeiM
\^paofng <9f /-fo/es
Fig. 32.— Daily Report, Blasting.
59. It will be noticed in Fig. 59 that employe No. I worked
from 7 to 9 at plowing, from 9 to 11 in rolling subgrade and so
on. It takes the foreman but a second to note the time, as he
always has his folder handy. All other clerical work is done
at the office.
Figure 60 shows the blank used for a daily report. This
daily report is a recapitulation of all work performed during the
day, as well as of all material received. This report must be
MISCELLANEOUS COST REPORT BLANKS.
153
filled out by the foreman each night as to the amount of work
performed and material received. All other work, such as cost
data, is figured out in the office. Under this method it can be
observed each day as to whether the foreman is getting efficient
work out of his men or not, and is a good way of demonstrating
to him where they are falling behind and where an improvement
can be made.
4^
Location
Cof?sfrac//o/7 Serme Co
Contract *
C/7a/7r/e//t7i^
Weather
Date
ChsnnoJef
Ha/psr-
y/orh
Mr^mar?
t^i^GS^^J^
/=ij/»/
3 em.'/fi
Tor^a/
t^rkc^pne
Hours.
%.
exfrtt
Hours.
^jct-ra
ffatc.
Tbta/
Unit
eo«f9.
J^nt/th of cut
Dfiplh
'^9^
HhfJ of Ffack
ToP^/x^.ft.
Con^/tton of fn^ch/nc
rrauaG
Gn^/t^serf
J2IL.
JtkSas&.
&fitsi/rs ^ <suppffBs nccekiet
^f^.r xv:^^/ics
irnr
Fig. 33.— Daily Report, Channeling.
The card shown in Fig. 61 is a teaming card, and one of
them is given to each teamster. The letter "O" is used to note
the time of arrival of the team and the letter "X" the time of de-
parture. The letter ''S" is used to indicate that the team drew a
load of stone; the letter *'G" indicates a load of gravel and the
letters "Sd" a load of sand. In the card shewn in Fig. 61 it
will be observed that the team arrived at 7:10 and departed at
154
COST KEEPING.
7:16, arriving back on the second trip at 8:04 and departing at
8:12. This card should be left with the teamster so that he can
call the checker's attention to it on each trip. If this is not done
the checker is apt to mark the card wrong, but with the teamster
carrying the card there will be no trouble about its being marked
each trip, for he will naturally be anxious to get in his right
number of trips.
d
Constructm Sem'ce Co.
Contract *
Dri// Oa/7^ /r'eco/z^.
Ut At? location leather Oate
m
^orA.
Work done
sts^.
^,
Hours
Tbral
Totat \ iM,r
^m'ts. \Cosrs 1
Foreman.
ffunneM.
Helpers.
t^uctti'nq.
A//yt>/>er3
F/'pe fjttintf
eiac/csmith.
Ititat^rhoy.
tVatc/ime/7.
POkver&ta.
7Zta/s.
M^hc ancf sisee of mochinms
Com/
Ota. of'Sfarttng OiTs
Af^t'/ nese/ctJ 4' rvhsn
Spacing of HO/C9
ff^msrks -g^j-
Fig-. 34.— Daily Report, Rock Drilling.
Inspector's Daily Report on Paving. — In Engineering
News, April 2, 1908, Mr. M. G. Hall has described the report
shown in Fig. 62. Each inspector was required to record the
number of men and their occupations once an hour during the
day.
A Flexible Cost Keeping System and Its Application to
Building Construction.* — Mr. Sam. W. Emerson, of Cleveland,
^Engineering-Contracting, June 13, 1906.
MISCELLANEOUS COST REPORT BLANKS.
155
has contributed to the science of cost keeping a description of an
ingenious system which has great flexibiHty and can be applied to
many classes of work. In some respects the system lacks com-
pleteness of detail, but when time is lacking to devise special
blanks it has great usefulness. Mr. Emerson's description is
given below :
The work is all done by the time-keeper, who in addition to
Co/?6/r(/c//o/7 Se/y/ce Co.
Cofifmcf *
Blac/rsm/fh /t'ecord.
Location ^eaf/ier Date
W^^U
IfihrADone.
Hours.
ff^.
Btcfra
eKtm
ffa-te.
Tofa/.
Tbfo/
Ami's
Or////>//&
Channft/^f'^
fSepair pn.'/s.
.. chetnnelei
HanstisJfCsrt'
MaJki'.<uJhn/L
Gtrtn K^fVd^r
.. Plsnt
^(kr-^J.
)
Tbr^/
Cval on hone^ Quo/if^.
r— f
Fig. 35.— Daily Report, Blacksmith.
his regular time-book carries .a small note-book. An engineer's
transit-book answers admirably, or books may be made up with
ruling similar to the illustration. A number of columns are ruled
on the right hand page, one for each rate of wages paid on the
job and one for the totals.
. Figure 6^^ shows the system applied to building construction,
the cost of each class of work being kept separately on each build-
iS6
work.
COST KEEPING.
On the left hand page is given the location and class of
The time-keeper making his rounds in the morning, notes in
the column corresponding to the proper date the number of men
doing each class of work. Four trips are made over the job each
day, on each of which any changes in the distribution of men are
noted. On the last trip the total number of hours worked on each
class of work is put down in the proper column.
/.
Construe f/or7 Sery/ce Co.
Confracf *
Oerr/ch /?ecorc;f
7Caf/o/7 IVeaf/fer Date
/Vf
fVork.
/ieq.
Hours.
ffeg
fTare.
extra
^ours.
extra
/fate
Thfa/.
Tbfct/
Amts.
tVorAnone.
Un/t
Cos/s.
£hfftnerr)9f
Tofmar?.
^?ufnp'q -
Cferr/cA.
Oern'cA-
P/ac/r7ef
/Inchoy-s .
/rjmrnarr.
Tor^j
1
Guy orpeff-/ea aferr/cA Heitfhf lern^-^ of6oom
K/na/ of buc/ref orrs/r/o Capac/Y/'
Jfin^ a/'nta/er/a/ moi^ec/ Ouanh'i^^
Ooa/ aset^ 0/7 JVas/e
O/Arr sc//f/j//es- usecf
Fig. 36.— Daily Report, Derrick.
M-7
The small figures in the upper and lower left hand corners
of the small squares indicate the number of men working in the
morning and afternoon. The large figures give the total number
of hours worked, which, multiplied by the rate at the head of the
column, gives the cost in dollars and cents in the right hand
(total) column.
MISCELLANEOUS COST REPORT BLANKS.
157
The sample page shows that on April loth. eight bricklayers
at 60 cents, one foreman at 70 cents and ten laborers at 22J/2
cents, each worked eight hours on Building A.
On the same building ten carpenters at 30 cents and one
foreman at 35 cents worked nine hours, four of them putting
in half a day setting window frames while the balance of the
work consisted in laying roof sheeting.
No concrete was placed on this date, but the cost of hauling
Co/7sfrcfcfio/7 Sery/ce Co.
Locat/or? tVeather Date
m
fTo/-^.
fyor/r /kj/te.
fteg.
//ours.
neg.
//o<j/-j.
5^^".
Tota/.
Thfa/
Amts.
cSsts.
H3fS^A(xr
•< -S^ne ,'
,,apfrsenf.^
niVstcr r.
A^/x&r
Ho/sfir'ri^
iyhee//'ne7
>^5^3^
^pnnkhhq
fvremof?.
^^.
P/acino .'
Tom/
Bags csm&nT Ci/./^ris .'^ian^ e7u.//££s ^<:thnA
M/'xTurA Mi'nd tf mixsr f{i'nd of Hoist
F'/onr lYorHeii an.
Fig. 37. — Daily Report, Concrete Mixing.
gravel, moving the mixer and bailing sacks is given. The num-
ber of loads of gravel hauled is stated and if any concrete had
been mixed the number of sacks of cement used would have been
shown.
From the above it will be seen how easy it is with this sys-
tem to learn the cost of special items, such as moving a mixer.
158
COST KEEPING.
setting up a derrick or repairing a breakdown, etc., which would
ordinarily be merged into some general account.
At the end of each week the distribution book was checked
with the pay-roll. The difference between them seldom exceeded
a dollar or two on pay-rolls of $i,ooo to $1,500, and even this
error could have been avoided by checking with the time-book
every day.
Co/7sfr(/cf/o/7 Sery/ce Co.
Confnjcf *
F/pe La///7<^
Location IVeather Oate
A/?
fVorA.
Hours.
/fe^ extra
/fate. Hours.
e*tfa
Tote,/.
Tofa/
/>mt-s.
Work Dane.
Unif-
ExcavJr^nCi
Shee//^^ &
h:ah<://Toa 4
Backf///ii^ff
ffj9mm'inry
^mM^
foreman.
To/»/
AjAin^M^r- iJ'Saaf
f^pS (^o- c/* /e/7i7//?S) Z. o/</ /r^rr? 0 Tfe t!?
Lesd y^r-n
Sp^^c'/^J /yZfS'^ry'^/s
A^/\sca//ryn^ous
Fig.
-Daily Report, Laying Water Pipe.
To get the time of changes in the distribution of men,
made during his absence, the time-keeper depends on the fore-
men or on the men themselves. Whenever convenient to figure
progress, estimates should be prepared each week and unit costs
determined.
Weekly estimates are easily made by anyone who can read
drawings, for brick work, laying roof sheeting, siding and earth-
MISCELLANEOUS COST REPORT BLANKS.
159
work. Daily estimates can be made with even less trouble for pile
driving, making ties, laying pipe, curbing, pavements, etc., and
any work which progresses in a straight line. Concrete can
w
Ah/^
T^/Z^Xbrn/ HitiUhac
/A//tr:^i
'S/oMn/tna/j
A
TLnZn B/,t:k0i
Pfy t//jrf *SAe&:^jl^
S/vc/rry
^lif^fjrM,/. /s^,
f\S
/y>&/rra/r
lf^ofej'60y
/w^me/f
Tb/n/
ConsTruc/'/on ^e/^y^/'ce Co.
Afo/^r/a/ mrap/^ain/^cfot/
\Jmo//^/' 0/7 /yafta/
Awoi//*T /4^v?e>//
\A/A^jV^^^
Coo/
-V
0//
Mts/e,
1 ^ ' ^
1
/Fe^rrtSfA^
ii/^^f/Jh^^-
B-iO
Fig. 39.— Daily Report, Trenching With Cableway.
always be roughly estimated from the number of sacks of cement
used.
i6o
COST KEEPING.
On large jobs, where material is handled in buckets by der-
ricks or cableway or in cars, it pays to have a boy count the loads,
and his record should show the amount handled each half hour
as well as the total for the day.
1^
ffa/t^
^gr-fo
/'OS,
TotckJ
5W^y^^^
fht/^M'S
Wht>^jfta
latx/AAjM^^Mfy,
.
laoi/na B/^cA
^ti//y,*yuw^»-/^^^.
• /^r/hk
Toia/
1
I
A//?/^y/a/
^/naJJn/'i/SPia^A^a^JAfa/J/t/'/yf A^/r/:/
^/770///f/' 4i°i^^e/
^i'/f AiftPi^e^
J3yjh/f
SOft^
Ce/f9e/fy-
^Atfye/
^Mj^
nf/r>oferA7/flfeiii?//s/^ e^^/e/va^
/?ipm£f/i^s
rV^^y/hey^
C-)2
Fig. 40. — Daily Report, Brick Paving.
For the office records a loose-leaf cost ledger should be used.
The loose-leaf ledger has many advantages over bound books,
one of which is that if an improvement in the arrangement or
MISCELLANEOUS COST REPORT BLANKS.
i6i
classification presents itself, the change can be made at once,
with at worst no more than copying a few pages. And it
is only by making changes and adopting improvements as rapidly
^i
//OUKS
/foTf^
UMj^r^i
Ctnc/m^ f///
Sah^/tm V S»*t„^ fam
/V/>. yP/oc. <ro«CAW?(i
* ^ ' /^n/s/,
T'fOVI/«/t77y
Hou/t try A^oA /h J^&
" A<,«, -
Tota/s
Consfrucf/o/7 Sefi^/ce Co.
Contt'Qcf A/o. Cement lYa/Zf
Afafef-Za/
^mfi/sft/h>eii^^Ams4/»f an M7»t
/ /f/WlCZ//»/ /li<W<7{-//
Cfi/nfnf
K^J^
Qtni/e/o^S/v»€
C/'nc/e/^^
Lumber
kV/dM 0/ iVo/A-
J / ^
C^ncfey f/// Y/'o/rt 0 too
Conrr&y-'f ^/ac&e/ A'f/jr.
/v/r/sA /=>'/acf'fy Af/j(.
Tr^mo^^'S.
r//t/['iAi^^ l/iffy/Jf f/v/TTG feto
Le^i/t r^t /Vau/
y/eaf/i^r
Fig. 41. — Daily Report, Cement Walk.
C d
as their merit is demonstrated that a first-class system for any
particular business can be obtained.
It will simplify the work greatly to have special sheets made
up for this ledger wider than can usually be found in stock, say
1 62
COST KEEPING.
15 in. or 18 in. wide and having a large number of vertical
columns.
The use of this ledger is shown in Fig. 64. All charges are
GP.
OP
(^.
QC
cc.
a.
or.
1
1
1
1
-
^ «: ::f -i^ r dpi^lf i- 9Sp. 7S
2?
2f
%
2;
OS
09
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entered under the proper heading and the totals can be obtained
at any time by merely adding up the columns.
A separate sheet is used for each class of work at each
MISCELLANEOUS COST REPORT BLANKS.
163
point, the cost of which is wanted independently of the rest of the
job.
Thus for a bridge substructure job consisting of three piers
and two abutments, five pages would be used to cover the con-
crete work, one sheet for each foundation.
The cost of the excavation and pile driving would be kept
in the same way and from a comparison of these sheets valuable
data would be obtained as to the efficiency of foremen and
methods.
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Fig. 43. — Punch Card, Trenching With Cableway.
In order to show the cost of work as it progresses, only
materials used, not those on hand should be charged in the ledger.
To accomplish this, materials are charged to suspense ac-
counts as received, the charge being transferred to the ledger
account as the material is used. To the suspense account should
also be charged the cost of unloading and storing the materials.
To illustrate: on a job where cement costs $1.40 per barrel,
unloading from the cars 4 cents by contract, and the cost of
cement sheds, storing, loss of sacks, etc., is estimated
at 7 cents, the cost of the cement sheds and all labor
of unloading and storing is charged to the cement account. The
164
COST KEEPING.
cement as used is then charged to the work at $1.51 and credited
to the cement account at the same rate.
Other materials are treated in the same way, and at the end
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of the job any small errors in the estimated cost of unloading and
storing can be distributed.
Credits may be shown on the ledger when necessary by
using red ink.
MISCELLANEOUS COST REPORT BLANKS.
165
On the completion of the job the vakiable data contained in
the ledger should be worked up into brief tables and filed away
on cards for convenience of reference, while the ledger sheets
themselves are taken from the holder and stored away in a
transfer binder.
The habit of using a card file should be cultivated as it i>
by far the most convenient method of filing cost records, quota-
tions on machinery and materials, addresses of foremen and one
hundred and one other things which will suggest themselves.
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Fig. 45. — Punch Card, Handling Crushed Rock.
In the writer's experience the cost ledger has always been
kept on the job, under the direction of the superintendent. Where
it is to be kept at the general office, report blanks should be used
ruled like the distribution book. On to one of these the record
could be copied from the distribution book and mailed to the
office every evening.
From the daily reports containing an exact statement of cost
and at least an approximate estimate of the work accomplished
the office could keep in pretty close touch with the work.
A Cost Keeping System and Its Application to Sewer
Work.* — The system of collecting cost data herein explained
*Engineering-Contracting, January 13, 1909.
i66
COST KEEPING.
is that used by the Moore-Mansfield Construction Company and
the Mansfield Engineering Company, associated companies, main-
taining an engineering designing and general contracting office at
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Indianapolis, Indiana. The character of the work done by them
covers almost the entire field of engineering and architectural
construction and it has been the effort of their Mr. Moore, who
MISCELLANEOUS COST REPORT BLANKS.
167
gives his time very largely to the estimating and cost record de-
partment of the organizations, to prepare a system which may be
used uniformly through their work and which may be used for
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The essential and fundamental feature of the systenri de-
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MISCELLANEOUS COST REPORT BLANKS.
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making the same of book size, and practically the same form as
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appears the time sheet in the usual form. This time sheet is
arranged so that it may be used for a gang reporting time weekly.
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and is also used where the time sheet is turned in each day, in
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side appears first the timekeeper's check column. The instructions
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MISCELLANEOUS COST REPORT BLANKS.
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to the timekeeper on the back of the sheet (Fig. 66) are probably
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sheet is used as a weekly report, as is generally the case, where
the gang is small or where the work is unimportant, the time is
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checked and divided by means of the four squares under each
date and opposite each name, each square thus representing one-
fourth of a day. In the case of the time sheet as illustrated, the
distributions shown are for a sewer job and the particular distri-
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MISCELLANEOUS COST REPORT BLANKS.
173
bntions required are shown printed in by means of a rubber
stamp. Each distribution thereby for this job shows a particular
key letter although the same letter may not mean the same thing
on any two jobs, but reference is made to the rubber stamp
heading on each contract to determine the meaning of such letter.
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No. Feet of Trench, co^ipleto
aroKMED
No. Feet of Trench for Ceseat Cub and Ovtter, eomvlaU
No. Feet of Cemprt C>:rhing liM 1
No. Feet of Ceaect Curb and Onttar laid
No. Feet of Cement Headers laid
Fta~«.»
All remarks ir.u5t a
pe»r
OS
he 0
ther
side.
Fig. 5S. — Curb R3port (See p. 151).
In the case of the daily report of a job in the timekeeper's
check column, each principal column under the "Dates" is counted
as two hours or each single column is counted as one hour.
174
COST KEEPING.
Each small square opposite each name in such column indicates
a thirty minutes check. By this means, automatically a man's
time is checked by thirty minute intervals extending over a four-
teen hour day. In using a checking system of this sort, it is
Sheet
q)nt^ ton
\r
Citu 1
\{
1
N*. OF EMTIjOYEE
1
2
J
"
28
29
30
31
'32
33
Total
Hou.i
OEADINa
Plowing
7-S
Ezckvatlng
BolllDg Bubgrade
'-i
■ CONOEBTE
BABB
HauUng & Loading Concrete Gravel
n-iz
1
Hauling & Loading Concrete Stone
Havdlng & Loading Concrete Sand
Laying Concrete
Hanllng ft Unloading Cement
BEICK
Hauling «t Unloading
1-0
5
Laying Brlcfc
1-8
1
Making Cuahlon
8-W
4
Hauling & Loading Cushion Sand
OuUlne Brlcl:
'i
BoUmg Brick
FELLnB
Putting m FlUer
3
Hauling & Loading PlUcr Sand
Putting In Expansion Jolnti
SEWEEAaE
Putting in Sewerfl & Inlet3
Putting in Catch BaMns
Putting In Manholes
BANT
Screening Band
CDKBINO
Hauling & Loading Gravel cr Eto=3
Hanllng & Loading Sand !
-■ BUNDEIES
Hauling & Loading flUing Gravel j
or Sand I
Cleaning up
General
MACADAM
EoUlng Stone !
I
Spreading Stone
Total Honni
10
10
\
Bate Per Hour
3J
ZQ
1
An remarks
must appear on the other side
1
Fig. 59. — Daily Time Report, Paving (See p. 151),
not necessary to write the letter indicating the distribution in each
square. Suppose that, in the first square in the first column, a
man is checked in at 7 :oo as working on excavation, distribution
A ; no further letters or checks are made until this man changes
MISCELLANEOUS COST REPORT BLANKS.
175
the nature of his occupation, which we will assume is done at
10:30, in which case a check is made in the bottom square under
the ten hour column. Suppose, in this case, the man changes his
work to distribution C, indicating back fill. This distribution is
r-^"/
0^#
190
W^nlh^r CnnJiHon A M
P.
M
OOKOaSTB BABB
(0«<Dt>
*—
Hfcfc.
■*
MM
Ml* II
rf
ac
sir:
Wo. nuk* eoMBt <a hiiid A. M.
Ma. 8<ute nawnt netni
Me. nu^ fmmx oMd
Wo. Suki e«»'t on band u nUbt
Mo. Kspt7 ucki ntnnad
Mo. g«. TtnU «na«t. l«ld
OBAVEI.. BTOMB ft BAMS
•KtlV^
wU,ly^
ncelTod
ncolTed
OBASINO
Mo. Load* of Dirt lunled
m. load! of eobblo atona baolad
Mo. I,oada of rnbbtih baolad
BBICK
Me. Brtck snloaded
Mo. 84. 7Uda laid.
riLLEB
Mo. 8q. rarda laid
Mo. Sacka caaant naad
Mo. Saeka com t on band at nlgbt
SEWEBS
Mo. F«et TUa raealrad
Me. Common Brtck racelTod
Me. Faat TUa laid
Me. blata aat
M«. CaUi Baalna, eomplatad
Me. Manbolca. eomplatad
8T7MDBY ITEMS
Amount of Coal ncelTed
TbeU » Bnppl^c* racalTMl
Memo k Ma eaia nnloadad
Orartiaid Mo. leada from and to
(■UU aaet polnta)
1 yi rtmart. must .pp«ar on
tb. Dlhe
r Sid..
Fig. 60, — Foreman's Daily Report, Paving (See p. 152).
then carried until we assume that the man changes his time again
at 3 p. m., which is indicated by the 9th column, and the letter F
indicates that he has been placed upon the concrete gang, and we
176
COST KEEPING.
will assume that he so continues until the completion of the day.
By even a casual observance of this man's time for the day, it is
evident that he spent 3^ hours upon back fill (taking an hour for
noon), and assuming that the gang quit at 6:00 p. m. that he
spent 3 hours upon concrete, making a ten hour day. This
system has been found to work satisfactorily, either upon a
weekly report basis or upon a daily report basis, and being used
uniformly on all contracts, whatever the size of the job or
character of the work, the office work has been greatly
simplified.
On the back of the time report are shown all of the matters
ordinarily appearing in the life of any contract. A complete car
y^ Job
Team
Date
Haul
~
'
6
0
2
4
6
?1
LO
12
14
[6^.8
20^
12
!4
J6^
28
?o
52
J4
J6
58
10
12
K
^
16
fe
50
i2
H
i6
P8
)9
7
0
><
3
8
0
y
c
;—
f^h
-
-
-
"'
0
>^
^
2
-
-
-
-
-
-
-
....
-
i
-
I • ill
V>^12
.
1
2
3
■
L 4
N. 5
X. 6
x«<
.■.
.
t
,.
'
', ' . • 1
Fig. 61. — Team Card (See p. 153).
report is made ; also items of expense and amount of cement
used. In the latter case, the opportunity is also given for the
dates when the cement was used and where used. On the right
hand side a complete report of the job is given. The manner
in which this is done is apparent from the form given; but
especial attention is called to the fact of the opportunity to check
up current work with past work; and also to compare the total
amount of "work done to date. The items are printed in the same
order by rubber stamps in the item column the same as they
appear upon the reverse side of the sheet under the distribution.
If the timekeeper is unable or not competent to make a report of
the amount of work accomplished, one of the supervising engi-
neers co-operates with him to secure this information, so that the
report may be a complete one.
MISCELLANEOUS COST REPORT BLANKS.
^77
In the matter of the office work, complete pay rolls are pre-
pared from the time sheet side and the cost of the work is posted
in the cost record book. This cost record book, however, is not
essential, but only as a matter of permanent record, as the sheets
Inspector's Dally Report.
V
Femlher
street -•"
Condition of Street-dry,
GRADING.
Bouii or i>*T
8
9
.0
11
...
12
....
'
4
s
....
T*»l
Gn4cn
WlKrkf.
Wagms
fkmt
OaDnnp
Forem.0
WaitrBoj
....
....
._.
C.T.Orad«l..
...
...
....
....
...
....
....
....
ROLLING. 1
Rol«»fS«b-»r«l«._..
H<rtUnf Bricks
....
;:
...
•
:
^
McsonRoIIrr
Sq Tdi. Rullcd
CONCRETE. 1
HandMixm
WbetleriKR AS
Wl«i«,.ConcTM«...
Mrara Mixer
E-«i«« „...
C«Km. vr,tm,%
Spr,.d.«
T.mpwm
F.«»«m»
W.wrBuy
'.'.'
-■
...
...
....
....
-
....
TMm»-Hiulior Rxk
T»ni»-HaDlinr!»iMl
Te»m»-H»«Il«» C«a.
Sark Cmeni «<tf ...
Sq. y4«9pr»ad
...
....
::
....
....
.......
....i....
1
BRICK LAYINO.
.
,
10
u
u
2
1
....
4
....
5
•
Tot*.
Brick Wbaakra
Brkk Lajcn
OtHcn „.
Pnnmaa
Water IW
Sq.T4.Uire<
SAND CUSHION. |
"~
._.
....
-
1.
:
....
....
■::
8<.y<i.C»hk»»<l..
....
FILLER. 1
Scneainr Sasd
MUlKCdry
"'»l^.-«t
Sw-pera
WhRhn
..
...
....
....
-•
-•
....
....
W»«« Bor
TeamaBaalhicS.....
T,.-.Ha.H«,».
Sq.ydv Fined ...
SackaCenest
Yd<Sa»d
...
....
...
....
....
....
....
....
....
....
I
....
EXPANSION JOINTS. |
Men.
BM*. Piuh
..
.._
....
BUILDING CURB. |
Grader*
SettncP««a
Foaadatioa*
Mixtrt, hand
Wheclen, aand
Wheelera. cement
Concrete -arm..
Concrete wheelers ....
T.-.P«.
Finnbers
....
.:.
...
-
....
.:
...
...
....
....
ReaoTinc Form*
Backimnp
Sacks Cent.
Linear leet bnilt
-■
....
....
....
....
-•
._.
...
-
CcserkI |>rc«reis o( aork 1
Any unmnal or importaBt natUf to rtpaet 7
1
1
'■•
'
Fig. 62. — Inspector's Report, Paving (See p. 154).
178
COST KEEPING.
Tuesdayy Apn 10- 0&.
1
BuiMinc "A" M.^mn^mm Illllllllllll
Brickwork
""'" ""■ :'"i"-
Brick/cryers
\h]\ '^1?'
Laborers. ffi?
/^I'
Carpenter Work.
SheeHngr r'^''l
ilg
Seifingf Frames. ./5 ^5
hf
Buildings "C"
C(?ncrei-e.
Hau/irt^ Orttve/ (74Locro/s) \V J??
ran
Movincr Mixer i ? )h \
,i:ii
Bailing' Sacks (Finisheci r^s rm.) \l-t
%i
Bai/dincr "D"
Excavafinqr. ^t'O
i\U'6
Superirrferrderif.
.i|
Tirriekeeper - Waferboy
¥[{
^^ j6f.ii
::::::::::::::: :::i:i
Ze-ZT* //arrd Bagfe. ffigrhf Hand Pa^e.
Fig. 63. — Timekeeper's Book, Building Work (See p. 155).
themselves show total cost to date at all times of each item of
work.
This form of timekeeping would be of value because of the
system of uniformity alone, even if no regard were given to the
other features mentioned, although the above companies using
this report are satisfied that they are securing more valuable data
by this form than they would have ever been able to do by
A.B&C SJiops. Concrete Foundorfions. - BIdg'S.
Dcrfe
Cemn
^J^rc
iSio
^e
For
n
s4
i-.
Em
'/>
7hr
vi
Mix.
7<'
fhc
'm)
Tar
w
(M
Fu
Pla
rf.
Lab,
^r
Apr.?4
PtiyRo// /iprJJ-/9
130
50
m
30
m
4i
00
„
Cement. 300 bbls. & /.5/
453 a
V
r
„
Stone 300cu.yc/s.S)/.00
m
00
„
Sane/ /20 " » ao.eo
72')
c
M
Lumber /O M S SO. 00
?00
00
Apr.-Ed
6"Be/f 30' a) 0.20
M
0
May?
Pay Pol/ Apr.£0~2e>
m
f
125
f
95
w^
21
V
-
ENG.-(pNTf^.
1
Fig. 64. — Loose Leaf Ledger Sheet (See p. 162).
MISCELLANEOUS COST REPORT BLANKS.
179
s
1
—
I T
r~
^
r
Ui
1 1
r
1
i-jUOQ asnoH
1 1
r
-I uoo a 0
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0 itBqadid
fc, 313J0U03
S :
a
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s :
0
W SJ3JU33
1
Q snidjns
1
0 ii!j n^^a !
CQ gutaaaqs
1
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<UOl^BAB0X3
II
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'ui 2
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1 1 1
;
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■ 1
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1
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-3- 00
£2
c. ■
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1-
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1 -
0
0
^1
1
1 1
^
1
1
:; ft
^;
i
b
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0
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6] <•
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ss
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1 1 1
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=
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•Rinoq pu^B $ ni jjoaqo xsnm
IIOH ABj puB nounqiJisia
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: ^
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0
l8o COST KEEPING.
previous forms used. The value of the uniform time sheet Hes in
the education of the timekeepers, resulting in a more efficient
working force. Under the old system with individual time sheets,
prepared especially for each job, the forms of the time sheets
were many and various, and, for this very reason timekeepers
presumed to incorporate their own ideas and make changes and
innovations, resulting in a bunch of data that required hours, and
generally the personal attendance of the timekeepers, to work out.
Passing from the time sheets, Figs. 65 and 66, pay rolls,
Fig. Gy, and the cost record book, the next feature of the system
of information or cost data consists of progress charts. These
of course, will vary with any job according to the character of
same, and, as they are used by nearly every large construction
company, it will only be necessary to say that blue prints are pre-
pared (generally blue line prints) upon which the timekeeper
is able to color in the work completed each day of the week,
marking dates thereon and turning such charts into the office.
These progress blue prints thus form a permanent record of the
progress of the work and also form the basis for the determina-
tion of the amount of work accomplished from time to time.
In connection with these progress charts, however, Mr.
Moore has a unique summary progress chart upon which is car-
ried forward and maintained a continuous record of the job, the
information being obtained from the summary report of the
time sheet. One of these summary progress charts is shown by
Fig. 68. The essential idea of this summary progress chart is
to have at all times a condensed, complete history of the work,
not so much with reference to the detail unit cost of each item of
work, but more especially with reference to a com-
parison between the estimated total cost and the actual total
cost. This comparison allows an intelligent idea to be made of
the portion of the w^ork done, and indicates at once whether the
actual cost is less than the estimated cost or exceeds it. The
general form of this summary sheet is a standard, but of course
will vary w^ith each job as to the number of items making up the
complete contract. Referring to Fig. 68, the chart illustrated is
being used in connection with a sewer contract, and a brief de-
scription will be given of the manner of the use of this chart.
In this case, the sheet is ruled so as to cover two classes of work
only ; namely, excavation and concrete. Under each one of these
MISCELLANEOUS COST REPORT BLANKS.
i8i
2
II
1
iisPiiiliiifii
^
2
1
o
timekeeper
0 for maklnj
id of colum
mn. In usl
must have
mn reprosen
e of the fou
leal column
tributlon co
ust be dlstrl
tthe foot of
ime. Tlmek
t as to time
to the ofUce
onthly or m
nge of rate
n
a
c
a
b.
c
CI
c
0.0!
INSTRUCTIONS.
It Is Intended that this sheet shall be used for all Jobs, whether
report to pay-roll clerk dally, weekly, or monthly, and Is to be used ala
mary reports. In usIuk this time sheet side, always place date at he
when marklnK out summary sheet place dally dates In the name colu
dlstrlbuHon side, the column marked "Timekeeper's check column"
placed at the head correspondlni? to the time sheet side, and each colu
day, the dlstrlbut on beluK taken fo\»r times per day and marked Insld
squares, uslnu distribution lett«r. However, for dully sheets, each vert
Bents one hour, and separation of time mtist be checked to the hour. VU
will be headed by rubber stamp for each lob and each man's time m
under the proper columns and the totals reduced to dollars and shown a
except that for summary sheets, total for each day will show opposite s,
and enKlneers will co-operate to Insure that summary sheeta are correc
butlon and amount of work done. Dally time sheets must be turned In
close of each day; weekly time sheets each Thursday evenInK, and bl-m
sheets will be separated and turned In at least once each week. No cha
will be allowed between pay-roll periods.
No deviation from these Instructions will be allowed on any Job.
•s
c
«
1 H
1
i
II
♦;
.v°
II
1
H
1
8
S
K
^
«
^
01
1
1
i
t
3
S
1
"a
1
d
1
c
c5
%
2
a
i
i
d
.5"
c"
a
a
o
CO
o
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(t
Q
■;^
4->
«
tJ
S
1
cu
—
*
?
Q
r
s
^
ti
p*
o
0
a
1
S
1-
M
g
c
;
1
o
fi
s
^
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s
G
\ ^
<
S
c
6
\ ^
y
"
* .3
•n
^
1
3
1
1
•rt
«
1
^
3
^
1 82 COST KEEPING.
headings, the first column is a percentage column. In using the
sheet, the length of the section is platted in the column marked
length so that the complete length corresponds to the ioo% line ;
the same is done with the estimated amount of cubic yards of
material to be handled corresponding to such length. The esti-
mated cost is then platted in dollars, the total, however, being
made to correspond with the 50% line in the percentage column.
Now, as the work proceeds, the actual cost is platted on the
same scale as the estimated cost and shows at all times the rela-
tive proportion. No matter what the total length of the job or the
total length to be handled, if the scale upon which same is
platted is so made that the length corresponds with the 100%
line, the general manager is able to tell, at all times, just where
any one section of the job stands. For instance, on the chart used
for section A of the sewer, above mentioned, the 100% line
equals in the length column 1,265 ft. = 3,186 cu. yards = an
estimated cost of $733.00, the latter point being opposite the 50%
line. Now, for instance, on the first day of August, the actual
feet of sewer constructed was colored in the length column as
about 610 ft. ; immediately upon the percentage scale line, we see
that this amounts to about 47%, and in the yardage column, this
gives us 1,550 yards. Upon the estimated cost scale the amount
to be expended for this amount of work was about $375.00. As
an actual fact in the case mentioned, the actual cost to the date
corresponded exactly to the amount of $375.00. At once, by
casual observation, the general manager or superintendent is
able to tell from very meager information just where the job
stands. Given the length, the cubic yards and estimated cost for
the section may be read off the chart and the actual cost com-
pared. If the record is made in number of cubic yards, and so
platted, the corresponding length may be read off. In either case,
the percentage of completed work may be compared with the
percentage representing the actual cost and in turn compared
with the percentage indicating the estimated cost.
The chart is also of great value on any section, especially
where the work is of a character that is continuous in its opera-
tion and continues in the repetition of certain units of work, in
that the timekeepers or superintendening engineers can read
directly from the chart the data necessary to complete the report
of work done on the reverse side of the time sheet.
MISCELLANEOUS COST REPORT BLANKS.
183
an«No.t....)At.. ..)
eby acknowledge receipt
e amounts «et opposite
amcs as payment in full
claims to date.
•ON
-
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0
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*-
»
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SI
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5
s
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of th
our n
of all
.
<:
2
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e <
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0
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rt
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1-
•ON S.UBW
h
1 84
COST KEEPING.
In the particular chart shown, various lines were also drawn
for unit cost, so that at various times during the progress of the
work, the fluctuating unit cost might be readily compared. This,
however, is not essential, and, in fact, it is but seldom used.
In connection with the particular sewer job referred to
above, in as much as the sewer itself was of various sizes and
5ecfion.A
Excavation
iSiLM.
JL
50
il
40
25
22
25.
m
)A
8.
Concrete
Est
^C05t
5^
i>-%
Act
C05t
-UJ
i
unit
C05t
Erm-Contr
Fig. 68. — Progress Chart (See p. 180).
to be built under varying conditions, the general progress blue
print was made as shown by Fig. 69. Attention is called to the
fact that each individual size of the sewer or change of condi-
tions is indicated as a section and all reports are made upon the
basis of such sections. Where the general character of the
work is the same, and the work is to be handled by the same
MISCELLANEOUS COST REPORT BLANKS.
185
methods, a letter is used as indicating a general division and
numerals added to indicate the sub-sections.
The costs of work, however, and amounts of work accomp-
lished are kept by sections and sub-sections, so that when the
'/7j//eA/ Enqineerjna Co.
En^rContr
Fig. 69. — General Progress Blue Print.
job is completed the cost of each size sewer under the conditions
met with can be readily determined. In the particular case men-
tioned, the principal item being excavation, concrete, or pipe,
the summary progress charts as just described are kept only on
these particular items of work, although the miscellaneous items
i86
COST KEEPING.
of work always appear and are carried forward upon the time
sheet distribution and reports of work done.
The particular contract referred to above consists of about
seven miles of main sewer, of which four miles is all concrete
construction, three miles of pipe work, and there are also some
four miles of miscellaneous pipe work, making in the aggre-
gate eleven miles. The same system of cost recording is being
used at this time to keep in tab with the construction of bridge
work, the construction of a boulevard, embankment work, and
also for the construction of several reinforced concrete buildings.
Foreman's Daily Pay Roll Report.
Location.. ..i^i/i Avenue....No. 2....96" Sewer 'Da.te,....August 7, 1907
Itemized Pay Roll. Work Done. Pay Roll Distributed
Foreman 1 days at
Engineer 1
Labor 1
274''
11.8"
Carts 1
Teams 2-10
Hoister 1
Water hoy 1
Total day's pay
roll
4po
3,50
sloo
1\75
150
300
600
200
75
300
200
83
10
General Night Watchman and Water Boy
Excavation completed to station 18.40 Cost
Sheeting " " " 18.30 ,
Foundation pl'nk" " " 18.00
Backfilling " " " 16.90
Sheeting Pulled " " " 17.10
Concrete Invert " " "
Brick Invert " " "
Concrete Sides 1 " " " 17.48
Concrete Roof J " " "
Steel Bars set " " " 17.48
Forms set to station 17.48
Forms, Pipe laid to station
Manholes built to-day
Other items Pump
Teams working Cement 17.48
Carts working Gravel ....17.48
Total day's pay roll
Signed L. — W. Foreman,
'25
1925
\25
263
300
62
2962
Fig. 70. — Cost Keeping on Sewer Work — Blank for Daily Report of Foreman.
(The blank was 8\ in. long by 5f ins. wide. In the reproduction words in italics a.n6.
figures are shown to illustrate use of blank in a specific case.)
Cost Keeping on Sewer Work.*— Mr. Keith O. Guthrie
has contributed an excellent article, which we reproduce here :
The report cards. Figs, yo and 71, shown below were de-
signed to gather detailed cost records from scattered sections
without increasing the ordinary clerical force. They have been
used on a large sewer contract in charge of the writer, producing
records in handy shape for daily and semi-monthly comparison,
easily compiled into compact totals for future reference. The
entire extra expense of the working system has only amounted
to the first cost of printing.
*Engineering-Contracting, Oct. 23, 1907.
MISCELLANEOUS COST REPORT BLANKS.
187
It is common practice, and properly so, on cost reports to
print the desired items of distribution and adhere to them
throughout. Otherwise it is the tendency to increase the num-
ber of special items ad infinitum, making comparison difficult..
However, on these reports, three extra lines were left to cover
special conditions, such as pumping, laying sub-drain, etc., occur-
Foreman's Daily Material Report.
Locsition.... 14ih Avenue No. S 96" Date, Jiugust 7, 1907
Full cement bags on hand last night
84
received to-dav
'"Z'woZ
Total
.244....
Full cement used to-day on cone, invert ,
• brick *•
" " " " " cone, sides 1
166
" roof [
" " " " " manholes .... . . .
1....
167
Balance on hand to-night
87....
Empty cement bags on hand last nieht
7....
Full bags used to-day
167....
Total
Empty bags sent in to-day
164.:.
140..
Empty bags balance on hand to-night..
"
24....
Materials received.
From.
Amoimts.
47—Ax6—16-it..
12—
-4x6—14
i" ronfers
-ft
Lumber
E. N.
ii2(y
Steel Bars.
Car No. P RR 7284
120 — I — IS ft.
120-
so-it.
..76-
Sheeting and bracing left in
place .
None.
L W.
Foreman. 1
1
Fig. 71. — Cost Keeping on Sewer Work — Form for Foreman's Daily Material
Report.
CThe blank was 8 ins. high by 5 ins. wide. In the reproduction the words in italics and
figures are shown to illustrate use of blank in a specific case.)
ring only on one or two sections. It is often difficult to secure,
on daily reports, an accurate statement of the amount of work
done. This is easily obtained on sewer work by referring every-
thing to the stations or "grade-boards." ^ This method obviates
everything and the daily distances check up when totaled for any
period of time. Indeterminate items, like teams, can be arbitrarily
coupled with some suitable item, such as Excavation or Arch.
l88 COST KEEPING.
To get an accurate distribution of a payroll it is necessary,
of course, to have the amount of the pay-roll. That the foreman
may find this readily, and, in part as a reminder, the different
classes of labor are tabulated on the left.
Toward the end of the day the foreman first jots down the
stations of completed work, then from his time-card, having sim-
ply the check numbers, rates and hours worked, he draws off his
day's pay-roll, finding it to be, as in the case taken, $83.10. He
now distributes first the minor items, which is readily done from
memory. For example, the Bracer and his three helpers worked
on "Sheeting" ; the two men on ''Backfilling" car ; the three who
'Tulled Sheeting" for five hours; the two bending and setting
''Steel Bars"; the two carpenters and one laborer on "Forms,"
and so on, until there is left only Excavation and Concreting.
As a rule the men who have been in the ditch can be readily
counted up, and Concrete Invert, or Arch, gets the balance of
the pay-roll. The last item, of course, gets some of the odds and
ends, but that is better and far safer as a basis for future esti-
mating, than heaping them into a "Miscellaneous" item by them-
selves.
These reports are daily collected by the general timekeeper
and checked up by him as to correctness of pay-roll amount.
They can then be used for comparison between different sections,
or between different days on the same section, without further
tabulation. At the end of a half month it takes not more than an
hour to foot up the totals of a section and post on the same
card, which is then ready to file in a card cabinet as a permanent
record.
The "Material" Report, Fig. 71, was gotten up to catch
the elusive cement empties and to follow the quantities used on
different parts of the sewer. By checking with the
storekeeper's records, the loss of bags or waste materials
can be learned soon enough to take advantage of it.
Cost Keeping Blanks for Building Construction. — We are
indebted to the late Chas. J. Steffens of New York City
for an excellent description of a simple system which is sus-
ceptible of wide application. It appeared in Engineering-Con-
tracting, July 4, 1906, and is given below.
The Guarantee Construction Company use on their small
contracts a form of report, illustrated herewith. Fig. y2, which,
MISCELLANEOUS COST REPORT BLANKS.
\
i
s
1
ii
li
UU
i
1
j
1
1
1
1
i
i
«.o.v
v^
^
^
1
•-^
*?
^
^
^
^
«*TH
-^
JZO
maou TTxox v©
5
■■• ::^:^
iKT«<««itT«a 1
■as-ao
•
KVnaji
^
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eeI^
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TH0MT1UX3
-^i^S;^
^
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.
:^m^^..
yr/i^^v^^vt*^
ay
0«USITJ
: ::;7i-
OJOiOOH c
■ ^ li
isajnaoTH
liraj,OKT
offla<uu9 xaon
•
oiaaao^S xatxh
:...: 1
XHCiT
: J
BUOuiMTj aicT ei<ns
'i
OKiHirang *ooa
t
o>ciso<nj "O-I
OBHOOTa ■«-«
oiOTocai •«-«
.7
0^alfTBJ
^
*^i
omsrra
A«J!OSTK ««oi9
iHVOBTK aaraa
o«.oo^xr^
Bmoj
^
^^T
uasjuoo
&
^
VcPe
OKI.CKnj
^
'»oS'
«OIiTAT3Xa.IOOH
;l|
KOUTiTora uara
^
'f^.k.
^
P
h
c^
\
1
^»Ta-o**o -i^ §
189
as
0) CO
190 COST KEEPING.
while requiring but little time to prepare, yet supplies all the
essential information for a detailed cost record. The report
is of course sent to the office daily.
The first column gives the number of men, the same hori-
zontal line being used for all men receiving the same rate per
hour. Thus, in the report illustrated, there were i6 men at
17/^ cents per hour, distributed as follows: Excavation, 55
hours; forms, 10 hours; concrete, 95 hours. The total hours
at this rate are shown at the right of the sheet, namely, 160
hours; the rate, 173^ cents, making a total cost, for this rate
of wages, of $28.00.
The men paid at other rates are entered in a similar man-
ner and the vertical column of totals is footed up. The hori-
zontal column for totals, near the bottom of the sheet, shows
the cost for the day of the various parts of the work, as, for
instance: Excavation, $9.61; concrete, $30; forms, $8.66; etc.
This column is also footed up and the two footings made to
check.
In the column of ''Cash Expenses of To-day" appear all
such items as carfare, etc., which the foreman pays himself.
These are entered in the vertical column to which they are
chargeable, as, for instance, in the case of twine secured for
use in construction of the forms, the cost of twine appears
under forms. These expenses are footed up and added to the
total already found, giving the grand total as shown. Upon
this daily report must appear all charges for which the foreman
expects to receive payment on the fortnightly payroll.
When the report reaches the office it is immediately checked
to ascertain if it is correct, and if so the proper entries are
made on the daybooks under the contract covered by the report.
Thus on Tuesday afternoon our books show the cost of each
contract or of any particular item of a contract up to the end
of Monday's work.
All material is ordered by the triplicate order system, by
which three copies of each order are prepared, one being for-
warded to the firm from whom the material is purchased,
another sent to the foreman on the work, and the third retained
for an office copy.
As soon as material is delivered on the job the foreman
checks such material and if he finds it correct sends the copy of
MISCELLANEOUS COST REPORT BLANKS. 191
the order which he holds back to the office, marking it O. K.
and giving the date on which material was received. When this
returned copy reaches the office, the material covered by the
order is at once charged against the contract under the proper
distribution of forms, concrete, etc.
The books in which these cost records are kept are of the
loose leaf type. A number of the pages are headed with the
name and number of the contract and one page is allowed for
each item of distribution and is headed forms, concrete, etc.
Should more than one page be required for any item the addi-
tional sheets may be inserted at any time. The pages are ruled
with a column at the left for the date, then a head space for
the description of the order. Beyond this is a column for the
order number and two columns, one for entry of cost of ma-
terial and another for entry of labor cost. The manner of ruling
these pages is shown above.
At the end of each month, or whenever desired, these col-
umns may be footed up showing the cost up to the previous night
on any item of distribution of any contract and subdividing such
cost into material and labor. A monthly data sheet is prepared
for each contract showing the estimated costs of the various
items and the actual cost to date. At the completion of the
contract another sheet is prepared showing the estimated costs
and actual costs as well as the estimated unit prices and the
actual unit costs.
In connection with these reports another form is used which
is also illustrated herewith, Fig. y^. This has, as will be seen,
spaces provided for reporting material received, material re-
quired, material which the foreman has found it necessary to
order and such other information as he considers it advisable
to communicate to the office.
The report blanks are furnished to the foremen in the form
of pads with alternate sheets punched with small holes along
the top close to the binding. These sheets are torn out and sent
to the office, while the next sheet, on which a carbon copy of
the report appears, remains in the book or pad for the foreman's
record.
It has been found that the use of these reports with spaces
provided for the above purposes will tend to call to mind the
various matters when the foreman prepares his report in the
192
COST KEEPING.
GUARANTEE CONSTRUCTION CO.
NEW YORK CITY
76^
The following material received to-day
Date ^:^'^/0^
to-day : ^'^^-^rC^t'J^ g^-^l/ (TuCe^^
Please order the following material; /3
— /£-er:
^^JJ
c^^^^ . ^y^i.^^:^^
g^^ /q^y^^f^^^. y&g^-^
/
/7—
_-, ^
Please hurry material covered by requisition No — /^ * /^ ^-Z
1 have ordered the following material to-day:
MATERIAL
Ckabox to
N...O,
FlBM
Pbic« 1
1
3Mie^^ /^afuMAA^tA^a^
/^^/^..,
t LA^fi^t^iu/ Oa.
7
r9(0
/
i:
.
1
•
m
Do not rtport on thU ihttt tkt purcAoM of any material you have paid for.
^^
-- Cy^g?*-^-*-»it<^_ cc^t^
a^.^.
Fig. 73. — Material Report.
(Actual size 6^/4 ins. x 13 ins.)
MISCELLANEOUS COST REPORT BLANKS. 193
evening, and matters which otherwise would be forgotten are
called to the attention of the office.
The Cost Keeping System of the Alberthaw Construction
Co.* — The following is an abstract of an article by Mr.
Leonard C. Wason, president of the Aberthaw Construction Co.,
of Boston.
In order to have an intelligent understanding of the mean-
ing of the figures hereinafter given, the method of collecting
data will be described. When making up an estimate of the
cost of a building, in scaling the plans, it is found convenient to
take off the volume of excavation and backfilling, the cubic feet
of footings, foundation and wall, the square feet of forms for
walls of foundations and above grade, the lineal feet of belt
courses, moldings, cornices, etc., also the size of special features
of exterior treatment. Similarly the superficial areas of column
and floor forms are measured by themselves. Concrete of each
different mixture is scaled off in cubic feet and totaled sep-
arately. Steel of each kind is taken off in pounds ; granolithic
finished surfaces in square feet, and so on in detail every item
is measured. As the work progresses it is desired to know
weekly how the actual experience compares with the estimate
and at completion to compile correctly the costs of each item to
compare with estimate and to aid in obtaining the true cost of
future structures of a similar kind. The method of accounting
was developed to fit the estimate.
In the year 1898 daily time reports were designed having a
number of columns for ease in sub-dividing the time of the
workmen. At the head of each column the timekeeper puts
index numbers or letters to show the kind of work being done,
and below, the actual time the men worked. On blank spaces
at the extreme right of the report the timekeeper inserts in
writing the amount of each kind of work done and the amiounts
of the principal materials used. The experience of eight years
has required no change whatever in the principles first adopted.
The only change in the forms has been to- increase the number
of vertical columns so that a larger number of sub-divisions
can be used without troubling the timekeeper to re-write the
names on another sheet. At the present time ten vertical columns
(Fig. 74) are used for recording time, with the names of the
*Engineering-Contracting, Jan. 13, 1909, and March, 1906.
194
COST KEEPING.
iom No. 747 Location, AttUboro. Mass. Albbrthaw Construction Co.. Boston
Daie. Aut. t. l»Off. Daily Report
Nunc of Workman
Time
Ofs
Time
Maef
Time Time
Maetv Mate
Time
Maof
Time
Maaiv
Time
Mel
Time
Meat
Time
Ceak
1^^
Opfiob
Rate 1 Amt.
Put at head of proper column or
against each name mdex of work
performed.
1 Cto^ Foreman... 1 PJ | I 1 1
1 1 1 1 1 1 1 1 State each kind of work done. 1
1 1 1 1 180 00 1 1 8.«8l Amount of Cem. and Materials used. |
i Maclnlire
9i
1 1
1
U8 00I 1 2 941 Weather |
8 Ccck.John
9i
{ 1
1
41 \ \ 3 89\ Temperature: 7 a. h.
4 Anetvint
1 8 1
4» 1
37i\Ma.f\ 1».38\ 1 P. «
*■ Biimfcard
7 1 « 1
1
37i\Maew\ 49.4S\ 6 p.m.
t Cameron
1 9 1
1
.gS \Maec | 3.11\
7 Ctougk
7 \ ■ 1 «
S7JI Maof 1 3 «7|
8 Cook, James
4 1
S
1
41 \Ma«w\ 9.0S\
9 Dunne
1
3
8
1
S7JI Mef 1 It 4I\
10 Dupont
8 1 4
1
S711 Meafl lg.S4\
11 Emmons
1 8 1
* i
.8711 Cedk \ 3 .88\ Ceak- Motor Shaft.
It King
1 9 1
1
.
.S7i\Mf,<,w\ s.ei\
13 Lambert
...
1 4 1
8
1
S7i\Meaw\ t .7B\
14 Lemin. | | I | U I , 1 \ . \
tS 1 ioT'l .8o| Meaf 630 c. f.
nL^,oy '1 1 1 1 1 1 . Ill'
S7\\ lS0.4i\Mea«tfi " ■ (^ rt)
16 O'Connell i \ 6 \ 9 \ 3
1 1 1 1
.S7»| 1 •■ lie •• (10 •• )
17 O'Hara
18 1 15
1
1 1
4n 1 1 •■ « ■• (SI •• )
18 Parrus ... .
19 1 1
1
1
.£8 1 1 1
1« Peterson
1 .19
1
84 1 "I 1/40 hags cenu,nt used.
20 ProulT
1 1 9
1
■37k\ 1 1
21 Robars.
1 9 1
1
1 1
S7JI 1 1
22 Sanfo^rd
1 1 « 1
1
! 1
■37k\ 1 1
» SpittU
1
1 1
37\\ ! 1
24 Sleeves:
1 t 7 1
1
1 1
t
37i| 1 1
25 TufribuU. .
1 1 « 1
1 1 7
.87i| 1 1
29 VcUenetle. .
1 18 1
.S7»| 1
27 Riley. ..
1 1 1
9 1 Iwua,.
..8| 1 '
28 Pkelan
1 1 1
1 1 9i
.«8 1 1
29 Martin. .
1 1 S 1
1 8
1 1
.£0 1 1 1
30 Johnson...
1 1 9 1
1 1
■eo\ 1 1
31 Spenser
1 \ 6 \
* 1 « 1
so 1 1 1 .
32 Lawson.
1 1 1
1 9J 1
«5 1 1 1
33 Geaudaux. . .
1 4J 1 8
g.7il 1 1
34 RUSS:
Waterboy | |
1 1
1 1 1
0^61 1 1
35 71
1 \ S \
1 a 1
.S3 1 1
38 esi
1 \ 6 \
1 4i 1
.iO 1 1
37 ess
1 1 « 1
/J 1 3 1
.i.0 1 1
38 853
1 1 8 1
« ! «1 1
«0 1 1 1
39 878...
1 1 1
1 7
«J 1 1
.«0 1 1 1
40 877
s 1
41 1 1
•«0 1 1 1
41 878
6 1
4\ 1 1
.to \ 1 1
42 88/
1
Ah 1 1
6
■*0 1 1 1
43 681...
1 18 1
4\ 1 1
B0\ II
44 esi..
1 ! 8 1
1 A\ 1
«0 1 1
45 68S. ....
1 18 1
1 4\ 1
.«0| 1
46 688
1 1 8
1 4\ 1
so 1 1
47 690
1 1 s
« 1
«i 1 1
so 1
48 8ft8
1 1 8
1 4i
.«0 1
49 696
1 18 1
' ,-**
so 1
6Q 8fl7
1 1 1
1
1 u
S
«0 1 1
Work performed.
Approved |
Fig. 74. — Daily Time Report.
workmen at the extreme left, two columns being left at the
right for the rate per hour and the total amount. At the begin-
ning of a job written instructions are given as to how the work
is to be subdivided into items in the reports. A standard method
of classification has been adopted as follows :
The principal sub-divisions are given a capital letter. Thus,
everything whatsoever relating to concrete masonry is given
the index letter M ; excavating of all kinds, including work
incidental thereto, the letter D ; all work connected with plant the
letter P, and so on, there being only six or seven sub-divisions
to indicate every building operation. To indicate the kind of
work vowels are used. Thus, the vowels beginning with a all
MISCELLANEOUS COST REPORT BLANKS. 195
relate to form work, as: 0, centering complete; when done by
separate operations aa is making, ae is setting, ai is straightening
up or bracing, ao removing after being used, and au cleaning up
and handling ready to be used again. All labor connected with
mixing and placing concrete or with handling materials for same
goes under the head of c; all work in connection with plant,
receiving, erecting, taking down, shipping and repairing, is in-
dicated by the vowel i. Thus / means receiving and setting up
plant ready to work, ia taking down, removing and shipping,
and ie repairing. The consonants are used to indicate different
parts of a structure in which certain work is done. Under classi-
fication M, h stands for footings, c columns, d foundations, f
floors, g stairs, etc. Under classification P, f stands for boiler,
g for horizontal engine, h for vertical hoisting engine, / for
elevator, m for mixer, etc. Thus our timekeeper places at the
head of a column when he is reporting concrete floors, for the
placing of forms Maaf, for concrete Meof. If a mixer is being
set up ready to work the report would read Pirn and later if it
was repaired it would be reported under Piem.
This is not so complicated to use as it may appear to read,
and experience has proved that every man who knows enough
to keep time can use the system with a few days' experience.
The principle is to make the least amount of clerical work to the
timekeepers on the job, as they have plenty of other work to do.
In addition to sub-division of time as above set forth, it is the
duty of the timekeeper to report the number of barrels of cement
mixed in a day, which is usually done by the man in charge of
the mixer counting the empty bags, and in addition the actual
volume of concrete measured in place. From this, knowing the
proportions, it is a very simple matter to obtain the amount of
sand and stone used and also to see if the right amount of
cement is being used.
Carpenter work on forms is reported by the number of
square feet of surface in contact with the concrete erected. Thus
walls are measured two sides without deducting doors and win-
dows, as it is usual to let the form work run straight across
these unless it is impossible on account of mouldings, in which
case the framing of the opening will cost as much as the form
work omitted. Beam floors are measured around the perimeter
of the beam and the flat surface of the panel and around the
196 COST KEEPING.
perimeter of girders. No deduction is made for the loss of area
by the intersection of beams and girders, and small openings in
the floor are not deducted. Anything as large as an elevator or
stairway is usually deducted. Form work for columns is meas-
ured for entire area of surface contact between wood and cement,
all four sides.
These reports are made out on the job daily and sent to
the office. The bookkeeper works these reports up into units
of measurement, as cost of labor per cubic foot of concrete and
number of cubic feet of concrete per barrel of cement, number
of square feet of form work erected, etc., and from this it is
easy to obtain the unit costs hereinafter given. The bookkeeper
can take the reports of four or five jobs, employing in the
aggregate 500 or 600 men, and in a single day work up the
complete report for a week's time ; thus it will be seen that
there is really little extra labor involved in the subdividing of
reports into a useful form over merely reporting the time so
that the payroll can be accurately made.
The system employed has appeared of sufficient value to
others to warrant its being briefly outlined in Gillette's "Hand
Book of Cost Data," pages 14, 15, and 19, and a description of
it also appeared in Engineering-Contracting of March, 1906.
Materials received on the job are reported on cards especially
printed for the purpose, listing the principal materials which are
reported, in order to save work of the timekeeper in reporting
materials accurately.
When a job is entirely completed and the ledger account is
closed, a master card is worked out giving the complete history
of the cost. On one side of the card are written the items
which went into the original estimate, such as excavation, back-
filling, footings, foundations, columns, floors, walls, stairs, etc.,
etc. In parallel columns are placed the actual amount of the
estimate with the actual experience, reduced to cost units, such as
cubic feet, square feet of form work, etc., and the percentage
of profit or loss between the estimate and actual results. On the
reverse side of the card the principal items are worked out
more in detail. Thus form work is reduced to cost of labor,
lumber and nails, wire or other sundries used in the forms per
square foot of surface. Concrete is itemized into the superin-
tendent's general labor, labor of mixing and placing, cost of
MISCELLANEOUS COST REPORT BLANKS.
197
cement, sand, stone; miscellaneous expenses such as teaming,
plant and other general items, reduced to cubic feet measure-
ment, which makes the total cost of the concrete in place in each
division of the building itemized for ready reference when
making up future estimates on work of a similar character. An
example of this form is given by Fig. y^.
It is well known that the costs of materials and labor in
different parts of the country vary somewhat. Having the unit
Job No. 747.
Date May 24th. 1906. Mill
Total
, Tappan Bros., Attleboro, MaSs.
Actual
Proposal. Cost. Per. Cu. Ft. Profit.
.135,164.55 131.330.48 $3,834.07
790.00 823.18 .021
. 1,738.00 1,033.57 .137 704.43
Per sq. ft.
1,955.00 2,162.02 .190
1,520.00 3,630.08 .125
. 8.883.00 6,542.16 339 -2,338.84
. 2,869.00 1,713.51 .237 1,155.49
Per I. ft.
832.00 676.65 1.470 155.35
883.00 910.35 .912
Per sq. ft.
469.00 636.53 .056
348.00 164.33 ... 18367
44.00 35.64 .... 8.36
Each.
852.00 729.99 2.19 122.01
Per sq. ft.
1,770.25 1,656.35 .189 .133.90
253.00 257.06
387.00 654.00
Per M.
1.086.00 835.12 52.17. 250.88
2,839.00 1,431.69 33.30 1,407.31
1,738.00 1,788.88 89.44
379.50 533.19 98.89
98.00 70.07 27.93
1,255.00 1,026.06 288.94
Per sq. ft.
1.009.00 647.54 .094 361.4^
211
429.00 316.90 .175 -112.10
400.00 375.00 .... 25.00
300.00 218.91 .... 81.09
1,860.00 2.271.73
100.00 120.00
77.80 67.97 .... 9.83
Per
Loss. Ct.
$ 11
33.18 ..
207.02
2.110.08
27. 35 ■. !
167.53
V.oe '. '.
267.00 . .
50.88 ; :
153.69
153.69
* 41V.73 ! !
20.00 . .
Footings and Fr
E.\terior walls
Wall and Fr. centers
Floors. 6%" thick
Roof 5V4" thick
Columns, 20x20"
Stairs
Ventilators on roof
Set windows and door frames.
Interior partitions
Bolts and iron work
Screens and setting
2" Spr. plank and laying
7-8"Maple plank and laying...
Motor shaft found
Roofing and conductors
Paving
Retaining wall-
Centers, per sq. ft
Painting
Steel footings and walls
Plant frt., etc
Bond
Extras
Fig. 75. — Master Card Giving Summary of Cost.
items all sub-divided, as above stated, into their elementary parts,
it is an easy matter after determining the cost of materials in
any locality to make the exact corrections to the results obtained
on a previous job. Similarly, when a difference in the rate per
hour for wages is known, if the same efficiency is obtained from
the men it is very easy to make a correction, or if the efficiency
varies, judgment must be applied to determine the correct rate
to use. It has been the writer's experience that although the
rate of wages and cost of materials vary somewhat in different
198 , COST KEEPING.
parts of the country, the variations frequently offset one another
so nearly that the sum total of the unit cost obtained in one
place may be used in another, very seldom needing correction.
For instance, within one mohth, after careful investigation, a bid
was made up on a structure at San Juan, Porto Rico, using the
same unit costs as for a building in Boston.
The following appeared originally in Engineering-Contract-
ing, March, 1906:
We give here a full set of the record blanks used by the
Aberthaw Construction Co., of Boston, builders of the Harvard
"Stadium" and other reinforced concrete structures.
The Aberthaw Construction Co. requires its foremen to
make daily reports on cards. The foreman has a time-book
(printed especially for the Aberthaw Construction Co.), week
ending Thursdays, leaving additional space sub-divided. This
time-book is his original record, which he copies on the daily
report card. The foreman does not enter the rate of wages on
the card ; that is done in the office, the idea being to keep the
clerical work of the foreman down to an absolute minimum.
On large jobs the time-book is kept by a time-keeper; but with
less than 20 men the foreman keeps the time.
The standard size of report card is 4 x 6 ins. These cards
are printed on heavy paper, which weighs about 160 lbs. to the
ream of 500 sheets, each sheet measuring 25 x 38 ins. Cards of
different colors are used to assist in rapid and certain classifica-
tion. For example, the daily report cards. Fig. y6, are
printed on yellow stock and on green stock. The yellow cards
are used for the regular contract work, and the green cards for
extra work. All the reproductions of the cards shown herewith
are three-quarters the actual size.
The blank is printed on the back of the card just as on the
front, except that the Job No., Location, Date, etc., are not
repeated. Hence on the face and back of the card there is room
for the names of 2y men. It will be noted that this particular
day's record related to concrete work, namely the building of a
reinforced concrete fence. The number of bags of cement used
in each class of work is recorded, opposite the corresponding
number of "beams," "bases," "shafts," etc. On the back of the
card is given the "Index" letter for each class of concrete work.
For example, we see that the "Index" for "beams" is BE, We
MISCELLANEOUS COST REPORT BLANKS.
199
see, on the front of the card, that workman No. 3 worked g BE,
that is, 9 hrs., on beams. We also see that he was a carpenter,
for his time is entered in the column for carpenters. We see that
he was paid 30 cts. an hour. In the column headed Am't., is
given a summary of the labor cost of all the carpenter work done
on "beams" (BE), "shafts" (S), "bases" (BA), etc. In the
similar column on the back of the card is the summary of all
day labor cost of the beams, shafts, etc.
In many kinds of contract work there is a certain amount of
general work, which cannot be charged directly against any
one item. This general work is given the Index letter G. There
is often a certain amount of lost time, due to break-downs of
plant, delay in receiving materials, etc., which it is well to charge
against an item called Delays, indexed D. In this particular
work of concreting on Soldiers' Field no such item is provided
for, because the work was of such a character and so handled
that delays were too brief to be worth recording. However, a
contractor should always require his foreman to keep a record
of every important delay, and assign a cause for it. This can be
done very nicely by using index letters ; thus, DM would indicate
a delay waiting for materials ; DB. would indicate a delay due
to a breakdown of some part of the plant ; and so on. If a break-
down were to delay certain men in their work for an hour, then
opposite their names would appear i DB, and 8 BE, for example.
Regarding the record of the quantity of work done each
day, there is always a possibility of error. To reduce this error,
the Aberthaw Construction Co. requires a supplementary report
every Thursday, showing the total work of the week, and the
condition of the job. In this way errors of estimated progress
tend to balance up.
The foreman does not do the computing necessary to fill
in the columns in Fig. 76 headed "Am't." This is done by the
office force. All the foreman is required to do is to record the
hours worked by each man, the class of work done by each man,
the amount of cement used in each class of work, and the like.
The office accountant knows just how many cubic feet or cubic
yards of concrete are contained in each beam, each base, each
shaft, etc. ; and can compute the amount of work done by simple
multiplication.
200
COST KEEPING.
Job No. J/^ Location Ji^^^^dc^e^i^ ^Xe^ ABERTHAW CONSTRUCTION CO., BOSTON.
Date ^ij^e/vd. ^O 190<:? Daily Report
Time
Time
ro.
lime
Concrete
Time
Time
Rate
Am't
Put athead of proper column or against esch
namo Index of work performed.
1 %/n<n^vC Foreman
J€
J!
^^.^;
State each kind of work done.
AmountofCem. and Glass used.
2 J^e^^/?^^A>o.&^j
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6'^
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'
Front of Daily Report.
Nameof Wopl<man
04.
15
/:t:^_
Time j Time
Carp.
Time
Concrete
^
Time Time
cecals
Rate
=?,.
//^
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Fig. 76. — Back of Daily Report.
I
MISCELLANEOUS COST REPORT BLANKS.
201
To quote from a letter by Mr. Leonard C. Wason, president
and manager, Aberthaw Construction Co. :
"All the figuring up of pay-rolls and summarizing of the
weekly summaries is done by the office force, which takes two
men about one day, and the book-keeper a second day, each
week, for all the work we have running. We have two comp-
tometers for mechanical figuring, which saves vastly in the time
Job No. J/*^
Fro
WEEKLY SUMMARY
''>/<^^^^etoSr^e€sO^'iMce^.
■date
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^
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JlK^MAHA IMC MFO. CQ.. SOOHlSXtAMtOaOtJOH^^UAfi iM-a'(
Fig. 77. — Weekly Summary.
and energy of the clerical force. The item of cost of keeping
these records is so infinitesimal that we have never attempted to
separate it from the general office expenses."
The office force makes a w^eekly summary, compiled from
the daily report cards. An example of such a summary is shown
in Fig yy, which is printed on a white card. This particular
weekly summary gives the cost, in dollars and cents, of shafts,
beams, bases, etc.
Figure 76 gives the time and cost of work done Sept. 26,
and it will be noted that the carpenter work on beams (BE) cost
$6.30 plus $2.00, or $8.30; this $8.30 is entered in the weekly
summary, opposite Sept. 20 and in the column headed BE. In
202
COST KEEPING.
0^ ^.37^
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^ont of Master Card.
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Fig. 78. — Back of Master Card.
MISCELLANEOUS COST REPORT BLANKS.
203
like manner all other summaries are entered in their respective
columns, as shown in Fig. 77. The second column of this blank,
headed "Fore," contains the daily wages paid to the foreman.
The lower half of the card is devoted to a summary of the total
number of units of work done and the labor cost per unit, ex-
clusive of the carpenter labor, but inclusive of the foreman's
wages. For example, the total labor cost of beams (BE) for the
week was $43.25, and the percentage of the foreman's wages
charged to beams is $4.71, making a total of $47-96, or prac-
Job No.
Date
MATERIALS RECEIVED aberthaw conrtructiqn CO., boston.
190 Foreman
SIZE OR BRAND
bbls.
from whom received ""
Cennent
SIZE OR BRAND FROM WHOM RECEIVED
bbls. Glass
bags
bars Steel
Ids.
Gravel
It ((
Sand
.<
" Screenings
w
lbs.
Cr. Stone
lbs. Lampblack
u
" Oakum
Ids.
N. Sand
'' Nails
" Ipswich Sand
ft.
Lumber
^f
T
-*^- '- 1
Fig. 79. — Daily Material Report
tically $48, exclusive of carpenter's labor. Now, there were 20
beams built during the week, so that the labor cost was $48
divided by 20, which is $2.40 per beam. It will be seen that
45H bbls. of cement were used in making these 20 beams, or
2.29 bbls. per beam.
We have seen how the daily report card is filled in, and how
the weekly report is made up in the office from the daily reports.
We now come to the final report card, or the "master card
of costs," as shown in Fig. 78. This card is printed on white
stock, and its face and back arc ruled as shown. The proposal
204
COST KEEPING.
J
1
k
y
1
f
FORWARD
Form looS
11
FORWARD
^ 1
Fig. 80. — Front of Loose Leaf Ledger Card.
#
,J
Fig. 81. — Back of Loose Leaf Ledger Card.
MISCELLANEOUS COST REPORT BLANKS.
205
price, the actual cost, and the prcfit or lOss on each item, as well
as on the total work, are entered on the face. Then, on the
backs of these cards, are entered the itemized unit costs, as illus-
trated.
It will be noted that all the cards are provided with a small
circular hole in the lower center of the card. This is for filing
the cards in the standard filing cases.
Fig. 79 is the daily report made by the foreman, show-
ing what materials have been received during the day, and
ABERTHAW CONSTRUCTION CO., BOSTON.
EXPENSE ACCOUNT WEEK ENDING
Name
Name
Day
11-:^
Amt.
Job
Day
Item
Amt.
Job
(
1
(
■ ^
Approved
w
. ^
Fig. 82. — Expense Account Report.
what materials have been shipped away. On the front face of this
card, as shown, are entered the quantities of different materials
received. On the back face of this blank the entries are made
of materials shipped away. This card is printed on blue stock
for the regular contract work, and on green stock for extra work.
Even the ledger accounts are kept on cards, the cards for
this purpose being Figs. 80 and 81. They are printed on white
stock, and each card is printed on both front and back faces.
Fig. 82 gives the expense account of each foreman or other
employee who incurs expenses in behalf of the company. This
206
COST KEEPING.
Pay Order ABERTHAW CONSTRUCTION CO. Scratch ^ Orijrinal
7 Exchange Place, Boston, Room 52 ""'""V Duplicate
is entitled to dollars ($ ixu)
in full payment for wages and expenses as per statement below.
Foreman^
Date
F
s
M
T
W
T
Total
Rite
Amount
Job No.
Time
^Expenses
j^ Foreman will eive every man discharged an otAm fl^B wKirh will be cashed after Friday noon.
.Mail duDlicate to office immediately. ... ..„,... . ......
Fig, 83. — Pay Order.
INFORMATION WANTED. ABERTHAW CONST. CO., BOSTON
Note Reply to the following inquiry on this card at the earliest possible moment and return to
the writer. The writer will keep a rarhon ropy. ^
Date
Mr
R<
Signed
Date
Answer
LIBRARY BUREAU »4e»60
Signed
Fig. 84. — Information Wanted.
MISCELLANEOUS COST REPORT BLANKS.
207
blank is printed on the front face only, and on salmon-colored
stock.
Fig. 83 is a "pay order" card, and is printed on the front
face only, on white stock.
Fig. 84 is an "information wanted" card, and a carbon
copy is kept by the man who fills out this card. This
carbon copy is printed on thin paper, alternate leaves of the
"information wanted" pad being printed on thin paper, so that
a piece of carbon paper can be slipped between the thin paper
Pattern No.
Order No.
Cast Stone
Article
Date
Remarks
ABERTHAW CONSTRUCTION CO., BOSTON.
Volume Cg. Ft,
Fig. 85. — Cast Stone Record.
and the card paper, thus giving a duplicate of all pencil writing.
During the busy season the office force is out at difterent times,
and the men may not meet one another for several days. These
''information wanted" cards are then very useful. The carbon
copy saves the need of remembering the question asked, and is
used as a follow up if the reply is slow in coming.
We may note, in passing, that the use of carbon copies is
becoming much more common than it once was. It not only
saves the labor of copying a record, but in case of the loss of
a record in the mails, or otherwise, the carbon copy is available.
208
COST KEEPING.
Quotation
Subject.
Messrs.
7 Exchange PI., Boston. Mass.
Dear Sirs :- Please quote hereon your lowest price f. o. b.
for the goods mentioned below and return this card to us and oblige,
Yours truly
ABERTHAW CONSTRUCTION CO
Per
Quantity
Xtid
List
Quotation
1
Sign here
Fig. 86. — Price Quotation.
In many instances it is wise to keep all records in triplicate.
This is easily done by having two thin sheets to each thick sheet,
two pieces of carbon paper being used when filling in the blank.
Fig. 85 is an example of a triplicate record blank. One
copy is kept at the shop, and the other two at the office. One of
the office records is filed by serial number, and the other is filed
by the subject of which the cost has been itemized.
When it is desired to secure a quotation on materials,
machines or products of any kind, Fig. 86 is used. A carbon
PRICE LIST
Article
Date
Firm's Name
Price
Terms
Remarks
m
^,
Fig. 87. — Record of Prices Quoted.
MISCELLANEOUS COST REPORT BLANKS.
209
copy of this card is kept so that a firm which is slow in replying
can be promptly followed up. This card is printed on blue stock,
one side only.
Fig. 87 is used for recording quotations on the same article
as given by different firms. It is printed on salmon-colored
stock, one side only.
A record is kept of every telephone message and every call
message; separate sheets 4x53/2 ins. being used to record
Cate. Af0^&l9g3.
¥-jt7 '-
3/zeOr///--^k___
1
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5-
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Fig. 88. — Chart For Recording Location of Drill Holes.
each message, giving time of day, name, telephone number, and
message.
To many contractors of the old school, who have trained
themselves to carry most of their business knowledge under
their hats, it may seem that any system of recording facts and
figures on cards or blanks is largely a waste of time. With this
opinion we cannot agree. The very marked success of such
firms as the Aberthaw Construction Co. is ascribed by their own
210 COST KEEPING.
officials as being due largely to the completeness of their cost
keeping system. Mr. Leonard C. Wason, M. Am. Soc. C. E.,
the president of the Aberthaw Construction Co., has given us
several specific examples of "leaks" discovered by virtue of his
daily report records. Then, too, every employee feels that
with such a system of daily reports, his output is bound to
come under the eyes of the head of the firm. Each employee
feels, consequently, that not only will laziness and inefficiency
be discovered, but that merit will also be recognized and ulti-
mately rewarded.
Cost Keeping on Rock Drill Work. — We give below some
sample charts from Engineering-Contracting, Oct. 23, 1907, to
be used in connection with the record cards to be found elsewhere
in this book.
The charts show the location of the drill holes and the key
letter that identifies the man who drilled them, as well as the
depth of the hole in feet.
Two kinds of charts are shown, each adapted for a different
class of work. Fig. 88 shows a chart for use on railroads,
canals and other engineering work that is laid out with a center
line as a ba»se for measurements. The ruling is the same as
that for ordinary cross-section paper, used by engineers, each
square representing a measurement of 2 ft. each way. Any one
wishing to adopt this form can have it printed or can buy cross-
section paper and make his own forms.
A word of explanation will show how this chart is used in
connection with the form for recording explosives shown in
Fig. 85. The work is being done on a new grade of a railroad
in a cut that runs from Sta. 92 to Sta. 98, 600 ft. long. A
stripping of 3 or 4 ft. of earth has been taken from the top of
the cut by scrapers, leaving exposed a ledge of rock 12 to 15 ft.
deep to sub-grade, shown in cross section taken at Sta. 95 -|- 50
in Fig. 90.
The two short vertical lines in Fig. 90 running through the
ground surface show the position of slope stakes set by the en-
gineer. On these stakes are marked the cutting and the station
number. Some engineers also mark on the stake the distance
out from the center. If this is not done the contractor should
have some one do so. With this distance known it will always
be possible to locate the center line, by measuring out from
MISCELLANEOUS COST REPORT BLANKS.
211
FtECOHD ofEXPL05JV£3 used ^^^/^3,
Ff
3pr/r7Cfjr7e^
BJa3t/r?(^
Cu.Vds.
Moved
Dyna-
Lbs.
Lb3.
Jod5on
Lb^.
Fuses
ru9c
Pmier Jud5on<^^^^
Lbs Lbs. rases
H/se
A-l
4
1
/
S
3
1
S
A-Z
E
4
1
3
A-3
5
3
2
10
IZ
/
6
A'A
11
7
25
4
30
1
15 7 i
M4
\?4S
A'5
IS
£5
.^/4
2Z
1
lOZ^
I-/4
\
A-e
3
H
/
3
34
1 — ;
rofaJ3 \34
25
/-%
67 !
29i
300
zU
Z43
Correct
F£?rema/?
Fig. 89. — Record of Explosives.
several slope stakes. For this purpose, as well as for other
uses, every foreman should be provided with a metallic tape line.
One of the authors has also provided his foreman with
a half-dozen steel pins like those used by land' surveyors.
These pins can be made by any blacksmith, and should be about
lo ins. long. Through the ring at the top a piece of red flannel
should be tied so they can be easily seen and thus save them from
being lost. The pins are not only useful in marking places on
the ground, but a foreman, by their aid, can make any measure-
ment he desires, without assistance. He can stick a pin through
the ring on his tape and make measurements without taking a
man from his work to help him.
In this way he can make his measurements on the ground
to locate drill holes, and put them on the chart as shown in
Fig. 88. In this case a driller, whose key letter is A, has been
En^-CoTTfK
Fig. 90.
212 COST KEEPING.
assigned to work in the cut in question. He starts by drilling
a 4 ft. hole 4 ft. to the left of the center line at Sta. 94 + 30.
Then he drills a 2 ft. hole 10 ft. on the right at +31, following
this with a 5 ft. hole 10 ft. on the left at the same station.
These holes are drilled to ''breast up" the cut at Sta. 94 + 32,
and while these holes are being loaded and shot, and the muck-
ers are cleaning up the blasted material, two holes are being
drilled for a large blast: Hole No. 4 at 10 ft. on the left, 12
ft. deep; and hole No. 5, 10 ft. on the right, 15 ft. deep, at
Sta. 94 + 44. After this blast is made a boulder is thrown in
the way of the workers and the drill is set up to put a 3-ft. hole
in it for blocking. This is hole No. 6, and notation is made
on the chart to show that it was drilled in a boulder. This record
can be made up by the foreman or timekeeper, from the pegs
left in the holes by the driller, these pegs having burnt on them
the driller's letter.
The blank filled out in Fig. 89 shows how these holes were
shot, and gives a record of the explosives used. Hole No. i
was sprung once with 2 sticks (i lb.) of dynamite, and then
shot with 8 lbs. Hole No. 2 was not sprung but shot with 4
lbs. of dynamite. Hole No. 3 was first sprung with i lb. of
dynamite, and again sprung with 2 lbs., being shot with 12
lbs. All of these holes were exploded with cap and fuse, as the
record shows.
Hole A-4. was sprung 4 times, first spring being with i lb.
of dynamite, second with 2 lbs., and the third spring with 4
lbs. The fourth spring was made with one keg (25 lbs.) of black
powder. Powder was used to develop a seam that was opened
up at the bottom of hole by the other springs. The springing
of No. 5 was done with dynamite, four springs being made with
respectively i, 2, 6 and 14 lbs. The last spring was shot with
an electrical exploder or fuse. The small amount of fuse used
in springing is caused by the fact that for the first springs
only a piece of fuse 3 or 4 ft. long was used tied to a stick of
dynamite, and after being lit it was dropped into the hole. This
can be done when the hole is not ragged. These two holes were
shot with Judson powder, the blasts being put off simultaneously
with a battery. It will be noticed that the fuses used are recorded
both as to number used and as to length.
MISCELLANEOUS COST REPORT BLANKS.
213
Hole No. 6 in the boulder was shot with dynamite with a
cap and fuse. The column for the yardage moved can be filled
in by the superintendent or some one able to calculate the ap-
proximate quantity of rock loosened. No yardage is recorded
m-
Da/e__
/22_
/r'ec^/z/eK I
1 r 1 III II! I "I
llllll IIIIIIIIIIMIIIillMllllllillllH
Fig. 91. — Chart of Drill Holes in a Quarry.
with the first three blasts, as these blasts are chargable against
the yardage moved by the last heavy blast made in the cut.
A separate sheet which need not have the springing columns
on, can be used for blasting boulders, and in a column for re-
marks can be noted the method used in breaking them up, such
as "block-holing," "mud-capping" and other methods.
214
COST KEEPING.
The blasts here recorded are not given as economical ones,
but rather as examples of actual blasts, in which there is nearly
always used more explosive than necessary to loosen the rock.
Contractors prefer to shoot rock in this way, as it is extremely
expensive to loosen and break up rock after an unsuccessful
blast.
The records shown on the chart and explosive sheet, should
be copied upon permanent records, in the contractor's office.
The office chart, for showing location of the holes drilled, should
be a long sheet of cross section paper, showing, on the same
scale as the small chart, the entire line, except the embankments.
The totals from the explosive sheet should be recorded in a
book made up for that purpose, which should also have columns
for the drilling records, the work done by the muckers, and the
transporting of the excavated material.
Fig. 91 shows a chart to be used in a quarry. A base line
can be run on each side of the excavation to be made in the
quarry, and from these base lines any point in the quarry can
be located, for recording on the chart. These records can be
transferred to an office chart that can be on a larger scale, if
desired.
From the chart shown here, it will be seen that four drills
are working in the quarry. Drills A and B on top of the ledge
of rock, and C and D down on the breast. C is a small drill
putting down shallow holes, while Z> is a large drill snaking in
holes on the breast as indicated by the long lines drawn from
the face inward.
A sheet similar to the one illustrated in Fig. 89 can be used
in a quarry to record the explosives used. An accurate esti-
mate of the yardage may be difficult to obtain at times; but it is
usually possible to approximate the yardage very closely by
calculating the cross-section along each line of drill holes and
the distance between the lines of holes.
In some tough rocks it is frequently necessary to drill a
foot or two below grade, in order to be sure to break all the
rock to grade. In such cases, due allowance should be made
when estimating the yardage of "pay rock" broken. In other
cases, the rock breaks one or more feet beyond the outer line
of drill holes, and allowance for this should be made also. But,
in any given kind of rock, the foreman or time-keeper will soon
MISCELLANEOUS COST REPORT BLANKS.
215
learn how much to allow for these factors, and can then estimate
the yardage of "pay rock'' accurately from the chart of drill
holes. In this manner it is possible to make a very close report
of the yardage of rock broken every day, without the necessity
of cross-sectioning with an engineer's level. The rock-drill does
the cross-sectioning.
Forms for Recording Well-Drilling Costs." — These forms
are gotten up by the Cyclone Drill Co., of Orrville, Ohio, and
are furnished to their customers for keeping records of drilling
done by machines bought of them. The first blank illustrated
in Fig. 92 is meant to record a day's work of well drilling or
HEPORT OF CYCLONE DRILL.
No..
For.
• Shift
190....
Number of feet drilled
Number of hours worked
DriUer hrs....
Helper hrs ... .
From to feet
Paid for coal Paid for oil
Paid to move
.DriUer
Fig. 92. — Report of Well Driller.
deep holes for blasting. From it the cost of drilling per foot
can be calculated, showing in detail the labor cost, coal and
oil and cost of moving.
The form shown in Fig. 93 is meant to be used for pros-
pecting drilling, especially where a core is taken for record.
The form is printed on the two sides of the sheet. It gives a
time record, depth drilled, record of delays, materials and bits
used, expense account for the day and a record of the drill
holes showing cores taken and the depth and thickness of the
strata drilled.
A Report Card System for Dredging Work.f — In the June
^3> 190/5 issue of Engineering Nei<:s, in an article descriptive
of the Bush Terminal R. R. Co.'s dredge 'Independent," men-
*Engineering-Contracting, Nov. 20, 1907.
fEngineering News, August 22, 1907.
2l6
COST KEEPING.
tion was made of a report card system in use on that dredge and
possessing features of some novelty. The system was devised
by Mr. William H. Arnold, M. Am. Soc. C. E., who was, prior
to June I, Chief Engineer of that company. Mr. J. A. Warner,
IJAILY DRILLING REPORT.
Date
Contract No Hole No .
For Whom
Address
Hole located near or at . .
.1905.
.Day of Week.
TIME RECORD.
DriUer,
Helper.
Helper,
Machine,
Name
Class. ■■■ Np
Began Work
u c
Quit.
1^ c
DRILLING RECORD.
Depth last Report
Amount drilled today.
Present depth of Hole.
Feet Inches
RECORDS. OF DELAYS OR DIFFICULTIES.
MATERIAL RECORD.
Kinds of Core Barrel
Used.
Length of Cutting Element,
whether Barrel or Bit.
Time Used
Before
After.
K
fe
c
^
c
Plain
Bit
....
Shot used pounds •. . .
Anything used in place of shot.
EXPENSE RECORD.
Paid Whom.
For What.
Amount
SUPPLIES NEEDED.— HOW TO BE
SHIPPED.— WHERE.
RECORD OF DRILL HOLE.
Kind of Strata Drilled
Today.
Thickness
Ft. i In.
Depth
Ft.
In.
To the Treasurer: I vouch for the
truth of this report.
Signed
P. O. Address..
Fig. 93. — Report of Prospect Drilling (Calyx Core Drill),
General Superintendent of the company, furnished samples and
data from which the following description was prepared.
The complete report cards are made up in three sections,
perforations allowing the sections to be detached for use. Figs.
94 and 95 show both sides of a complete card. All of the
information required concerning the loading of a scow is printed
on the card, and such information as applies to the loading of
MISCELLANEOUS COST REPORT BLANKS.
217
any one scow is indicated by a punch mark opposite such infor-
mation.
Fig. 96 shows the portion of uhe card on which the punch
records are made, as filled out. On this portion of the card,
the serial number indicates the consecutive number of scows
loaded; for example, the serial number 250, shown in Fig 96,
^^si
,1 rr
f^K'^'T,
- v" :r y
>•- n! ij ie xr cr :; >t n^vi; 3 ♦rtf'ST * "f .OfJl.*!"*^
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I - ^ .•' 2 ^- - ^ - - '
i
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a
; ^ i ^ = 0 :- 7 >: :- ? / ?,
1
2l8
COST KEEPING.
indicates that the scow covered by that report is the 250th scow
loaded since the dredge began operation.
Provision is made to show the date, hour and minute at
which the loading of the scow was begun and completed. The
weather conditions, the kind of material handled, the location
sPA r.Q ON iC\oi
\n :SH 'i"h:K\IINAL CO.
CHIEF r^'^..'V£-.--/?^^ off'Cf
Fig. 95. — Back of Dredge Tug Report.
MISCELLANEOUS COST REPORT BLANKS.
219
where the dredge worked, and any delays that may have
occurred, are also provided for.
The amount of material loaded in the scow is indicated by
a percentage system. In the sample card which has been filled
out — see Fig. 96 — the loading was 60% sand, 35% crib and
5% rock. The percentage, of course, is based on the carrying
capacity of the scow, which in the case of the Bush Terminal
R. R. Co. is 800 cu. yds. ; hence, as indicated, 60% of the 8oo
cu. yds. was sand.
On the back of this portion of the card is a diagram repre-
senting the six pockets of the scow; this diagram is shown in
S| 12 3 4 5 6 7 8 9 10 11 12 13 14 15 16 #
21 23 23 24 25 26 27 28 29 30 31
.•.£1 "
9 -
i =r
U\
s s s g s s
N.-.
i«y
N. a
Clear
B.
Raui
S. B.
&
Fog
S.W.
Snow
w.
Ice
N*^.
BUSH TERMINAL CO.
CHIEF CNGINECR'S OFFICC
Foot 43rd St-eet Brooklyn, N. Y..
DREDGE INDEPENDENT
2 So
THIS REPORT TO BE SENT TO OFFICE AT CLOSE OF EACH DAY'S WORK
UQfATION (Where Dredge is Working).
//r^«i^ CxJLi^iM
Clay
3S C*
LOST TIME, CAUSE OF DELAY :-
Jan.
Feb.
April
May
July
Aug.
Sept,
Oct
Nov.
Dec.
ii^dJU
R,.3a
1903
1909
1910
.ill.
# - g -
g P^ixl-.
SCOW
1 3 3 4 5 6 7 8 9 10 11 12 13 14 15 16 # 18 19 20 21 22 23 24 23 26 27 28 29 30 31
Fig. 96. — Dredge Report (Punch Card).
Fig. 95- When this portion of the card is filled out, notations
are made in each of the six spaces in this diagram, showing
how many of the pockets are full and how many partly full.
Where the pockets are not filled, the shortage is indicated by
the number of feet and tenths of feet that each pocket is short-
filled; i. e., if five of the pockets were full and the sixth 0.5-ft.
short-filled, the spaces representing the full pockets would con-
tain the word *'Full," and in the short-filled pocket would be
made simply the notation "0.5." In the case of an 800-cu. ft.
scow, then, that would indicate that pocket No. 6 was filled to
within 6 ins. of the top of the coaming, and the total yardage
for that scow would be 792.5.
220 COST KEEPING.
The other two portions of the card, as shown in Fig. 94,
are filled out by the captain of the tug which tows the scows
to sea. They are given the same serial number as that given
to the report of scows loaded. The addressed section is mailed
to the Bush Terminal Co. and the unaddressed section sent to
the owners of the tug towing the scow, for their information in
rendering bills for towage.
The serial number of each scow is shown on the towing
company's bill, thus enabling the towing company and the Bush
Terminal Co. to agree without dispute upon the amount of any
towing bill.
A System for Recording Costs of Dredging and Dredge
Maintenance.'^ — The following, by Mr. Magee Fisher, is an
article with blank forms describing a system which will appeal
to many for its simplicity. It will be noted that this is more of
a book-keeping than a cost-keeping system proper.
Accounts divide themselves into two classes : First, accounts
of original entry, such as ''time books" and ''purchase books,"
in which employes' time and purchases of various sorts are
entered when made; and, secondly, accounts of final entry, to
which are copied the items previously recorded in the books of
original entry; the accounts of final entry are known as the
"ledger." If the accounts of original entry can be so arranged
that only footings have to be copied to the "ledger" an immense
amount of work and inaccuracy is thereby avoided. Such an
arrangement is doubly profitable, for it obliges the accountant to
decide beforehand just what accounts he will and will not keep ;
then, having decided, it is a very simple matter to make all the
original entries chargeable to any given account on a page by
themselves; then at the end of the week only the sum total of
the page need be copied to the ledger; and, if the loose-leaf
system, is used, all pages of original entry chargeable to that
account, from the time book and purchase books, can be gathered
together. But loose-leaf books have been a constant source of
bother, the pages either tear out or some special kind of punch-
ing and paper have to be purchased. Fortunately, however,
there have recently appeared for sale substantial clutch binders
♦Engineering-Contracting, August 14, 1907.
MISCELLANEOUS COST REPORT BLANKS.
221
capable of holding unpunched paper of any kind and in such
shape that the whole outfit may be handled as conveniently as
a bound book.
Accounting is not an easy subject to write about intelligently,
but the writer thinks that if any one interested will study the
sample pages of accounts shown herewith he will be able to
No purchases to be entered on this page except those chargeable to
Cost and Mainttnance of Drtdgt.
Purchases entered by John Smith,
Date
1905
Items
Check
Nos.
By
Check.
In
Curr'cy.
On
Acc't.
Ledger
Transfs.
OC j8
17
20
21
American Steel & Wire Co., cable
Novelty Iron Works bill to date
201
203
$31.00
70.17
♦'S:??
$30.00
From materials charged to Stock Acct.
2-7' X 16^ X 32' timbers
Lamb Auto Co., acetylene lantern
Nevine Hardware Co.. Crosby clamps
Total
$101.17
$22.50
$30.00
No purchases to be entered on this page except those chargeable to
Operation of Dfedge.
Purchases entered by John Smith.
Date
1005
Items.
Check
Nos.
c£J..
In
Curr'cy.
On
Acc't.
Ledger
Transfs.
Nissen & Jacobson, 12 yds. oilcloth
Standard Oil Co., 5 gallons cylinder oil. .. .
E N Woodbury & Co , gaskets
$3.80
':fl
2.00
$78.40
Oct. 16
11
20
21
Smith & Sons, carload coal. No. 13347... .
1
Total....
Week ending October 21. 1905
110.46 S78.40 1 1
1
Fig. 97. — Purchase Book Sheets.
acquire the salient points. The illustration taken is the cost
account of a dredging operation which the contractor not only
wished to keep separate from his other operations going on at
the same time, but to sub-divide so as to ascertain separately
the cost of setting up, of operating and of maintaining the plant.
222
COST KEEPING.
•aDUBua^urBj^
lunoluy
Vunoaty
•8;«H
sjtiojj
uot^BjadQ
■ sjnojj
T) Q
"5000 OSOJO OSr-i-*
O^^O OOO 0^(M>0
0»-"rHO OOO Of-ic^J
O-H'HO OOO o>-ic^^
o<-iT-io OOO o»-ie^'-i
OOO OOO 0 0'-"(N'^
r|2
1 g (d
u u
»o o o
0 c • • c
•.2.2 • '.2
a a a c3*rt p, p,'S a a o, a a
OOOSSOOl^OOOOO
(« o
i^
t>0
'H'
— ' " S* c
2«-r "J
m,
•73 CM
. C c •
:S2a
•>,>,J3
: 3 3.S g
^^
• tS i2 o o
.•_2 o o rt -JJ ™
MISCELLANEOUS COST REPORT BLANKS. 223
For this purpose he decided on two accounts as sufficient,
one entitled "operation" and one **cost and maintenance."
First, in the "purchase book," Fig. 97, were entered all
the purchases, which, for the benefit of the bookkeeper, were
classified into "check," currency," "account" and "leager
transfer" purchases. Secondly, in the "time book," Fig. 98,
were recorded the time of the employes, the state of the weather,
the actual time operating, the progress of the work and other
items of import. Then each week the sum totals were carried
to the two ledger accounts, Figs. 99 and 100, where all functions
of the work could be analyzed week by week. Observe the sep-
arate columns for each function — one for coal burnt, one for
shifts worked, one for man-hours, one for cubic yards moved,
one for labor cost and one for material cost.
The contractor's confidential bookkeeper also week by week
posted off from the "time" and "purchase" books all cash items
to his cash book and all "accounts" and "ledger transfers" to
their proper places in the "ledger," thus completing a balanced
or so-called "double entry" ledger.
Then when the work of dredging was finally finished the
contractor abstracted the cost for future reference, Fig. loi, thus
completing his record.
Many engineers might find it convenient to keep similar
cost abstracts of work valuable to them in a small card index,
which would hold such records for a HfetimxC and yet never
be bulky. It seems as though printed matter and other records
accumulate so fast that the average individual is completely
"swamped" and gains no benefit from his records, whereas, if
the essential points were abstracted in compact form he could
have them always at hand.
As illustrated above, the cost of any given piece of work is
ascertained by adding together the various items, such as the cost
of the labor, of the material, of the depreciation on the piant,
of rent, of traveling expenses, etc. The amount of the work may
be measured in units such as cubic yards of earth excavated,
lineal feet of road built, or in per cents of completion, as in the
case of a house where the architect specifies that it is 40 per
cent completed.
If the contractor has spent 50 per cent of the money doing
40 per cent of the work, he is apt to have the cold shivers. As
224
COST KEEPING.
Ledger for
Cost of Maintenance of Dredge.
This account opened at commencement of Building of Dredge, June 15.': 1905.
Page 2.
Date
1905.
Items.
1
q2
Debits.
Credits
Cost
Labor.
Cost
Supplies,
Oct. 21
21
21
21
Forwarded
Pay roll for week ending Oct. 21.
Purchases, by check
do currency
do ledger transfers
1,951
100
S436.22
17.50
1913.57
101.17
22.50
30.00
Footing — week ending Oct. 21.
30
2,051
$463.72
U,067.24
Fig. 99. — Ledger Sheet.
Ledger foi
Operation of Dredge.
This account opened at commencement of operation, July 15, 1905.
Page 3.
Items.
ii
C 3
rt O
li
di
Debits.
Date
1905.
Cost.
Labor.
Cost
Supplies .
56
32
144
12
10.085
646
13,781
1,200
$2i215,36
145.53
$1,209.15
Oct. 21
Pay roll' for week Oct 21
21
Purchases, currency ,
10.46
21
21
do , On acct
Cars of coal No. 13347— No. 768
78.40
Footing-
—week ending Oct. 21 ,
90
156
10,731
14,981
$2,360.89
$1,298.01
Fig. 100. — Ledger Sheet.
Earthwotk — Dredge Operation.
(Abstract of Cost.)
1906.
Location — Mississippi Valley.
Nature and extent — Railway embankment 2,000 feet long and 12 feet high; ' borrow pit along .^ide
and parallel with same.
Material — Sand and silt of Yankee River Delta.
Total yards moved
Shifts worked (ten-hour)
Cu. yards per shift
14,981
156
IS
Total cost $6179
Cost per yard — total 34 , 6c.
do. — operation wages 15.8
do. — operation coal J. 7
do. -Operation repairs 7.0
do. — cost of plant wages 8.0
do. — cost of plant matetial ; 7.1
Pounds of coal burned • 180.000
Pounds per yard hioved i 12
Average rate of wages per hour , 22c
Fig. 101. — Final Abstract of Cost, Dredging.
frequently happens, he does not discover this until the facts have
become ancient history.
This is one wrong way of cost keeping. He might better
have not kept any accounts at all, for what good were they ?
I have taken a house as an illustration, but many of my
readers can bring to mind some railroad or other large under-
MISCELLANEOUS COST REPORT BLANKS.
225
taking that has come to grief from the same cause. Too much
stress cannot be laid on the importance of entering all items of
expense instanter and of keeping the accounts up to date.
Another wrong way of cost keeping is to keep too many cost
accounts, the resulting work being so vast as to be a burden.
Many persons fail to realize the amount of work involved in
accounting; and this work is apt to be greatly increased unless
the books are carefully checked and balanced at frequent in-
tervals.
Estimating is almost the reverse of cost-keeping. The
work to be estimated is measured up into suitable units and
tabulated. This is called '^taking off." The estimated cost of
each unit is then applied and the amount in dollars set out in
the cost column. This is called "extending." This, then, is the
engineer's estimated cost of the work to which the business
department adds various amounts for overhead cost, profit, in-
surance against accidents, interest, etc. Many business men
are said to add a liberal per cent for underestimating on the
part of their engineer. Experience in paying the bills of under-
estimated work is a sure but costly road to accuracy in esti-
mating.
Cost Keeping Blanks for Dredging.* — The port of Port-
land, Ore., has two hydraulic dredges at work deepening and
widening the channel of the Columbia and Lower Willamette
rivers. One of these dredges has a capacity of 8,000 cu. yds.
per day in sand, and the other has a daily capacity of 20,000
cu. yds.
The diiedges work under the direction of the chief engineer
of the Port, Mr. J. B. C. Lockwood, M. Am. Soc. C. E., and
he uses the following forms in keeping a record of the work
done and in obtaining the costs.
In Fig. 102 is shown the blank for the leverman's report.
On this report the measurements are given from which the
yardage dredged can be calculated. Also a record is kept of
passing vessels and all delays to the dredge.
In Fig. 103 is shown the report of the chief engineer of the
dredge. From this report the delays are taken so that it can
be a check on the leverman's report. As to causes for delay.
♦Engineering-Contracting, May 26, 1909.
22(i
COST KEEPING.
THE PORT OF PORTLAND
LEVERMAN'S LOG
T)rf//g^
Tjwatiofi
JUfift Mn. J Wfi. 9 Mr, ^
Time
G^e
BeU.
Depth
Width
Depth
Time and Caute Each Delay
Other Veueli Pa.ted
'
._..
Fig. 102. — Leverman's Daily Report, Dredging.
the leverman shows the reason for all causes other than those
occurring in the engine room, the causes for the latter delays
being given on the engineer's report. This report also shows
the amount of fuel used. The dredges for this work burn saw-
MISCELLANEOUS COST REPORT BLANKS. 227
THE PORT OF PORTLAND
ENGINE ROOM LOG
Date.
Dndge Location
Shift No. J No. 2 No. 3.
Total running time
Revolution counter No.
Blowed boilers at
Fuel receired. Scow No.
QuMitity on icow
Qtality
Time and came of deUyt in engine room
CHlEf ESCINEER
Fig. 103. — Engineer's Daily Report, Dredge.
dust and shavings, the quantity being measured and estimated in
cubic feet.
In Fig. 104 is shown the blank used for the captain's report.
The other reports are meant to show some details for each shift,
there being 3 shifts of 8 hours each, while in this report all the
work is grouped for the 24 hours. This report is evidently
228
COST KEEPING.
THE PORT OF PORTLAND
CAPTAINS DAILY REPORT
/It
Fof 24 hourt of
jon
Character of maten'al
Leng'h of pipe line
Height of discharce
Pontoon pipe In use. Ko.
Shore No.
Moved ahead Feet Total for month
..,
Depth dredged be!ow zero
Averacf "idth of cut
" depth " "
Yards exravated Total for Month
No. hours run •* "
Lost time " " "
Revolution counter
Fuel received. Scow No. " " "
" quantity Quality
Rubber sleeves failed. No.'s
" " installed. No.'s
Hauled for vessels No. Total for Month
Other vessels passed No. " " "
CAPTAIS
Fig. 104. — Captain's Daily Report, DreJging.
made from the two previous blanks and also from data collected
by the captain, or under his direction.
In Fig. 105 is shown the cost analysis sheet, gotten up each
month by the chief engineer of the Port. This form is at once
a summary and also an analysis showing the cost per day, the
cost per cubic yard, the average time worked per day, with
average work done. This report is made up from the daily
MISCELLANEOUS COST REPORT BLAXKS.
22g
THE PORT OF PORTLAND
No.
ENGINEER'S MONTHLY REPORT
"ptf^/fg* -,-
r^' l...
Pnr IncltLsk^e
190
CfcMicter ol rtiteriiJ
Uneth of pipe line
Height of ditcharee
Pontoon pipe in ihc. No.
Shore pipe in o«. No.
Moved ahead Feet. Average per da.
Feet
Depth dredged below ,ero
Average width of cut
Average depth of cut
Vardi excavated Average per day
Yards
No. hours nin " " "
Houn
Lo«t time " " " "
Revolution counter " " "
Fuel received. Scow No. ......
Load
Fuel, quantity Quality
Rubber sleeves failed. No's
Rubber sleeves installed. No's
Hauled for vessels. No Average per day
No.
Other vessels passed. No.
Total cost at « per calendar day 8
^ Coft per cubic yaH cent>
Chief Encjnuk
Fig 105. — Engineer's Monthly Report, Dredging.
reports of the captain and also from the timekeepers' sheets
or pay-rolls. We regret that we cannot reproduce a copy of these
forms. In all cases there should be blank forms, showing the
number of men worked on each shift, their positions and rates
of wages.
Special attention is also called to the analysis sheet, as this
is a weak point in many cost-keeping systems ; that is, the lack
230 COST KEEPING.
of an analysis sheet. From such a sheet it is possible, at any
time, to learn of the efficiency of the work being done, and at
the end of any job the average cost is quickly calculated. This is
not possible when daily sheets only are kept, without a great
deal of labor, and when a large number of daily reports have
accumulated it frequently happens that it is never done. Thus
the greatest value of cost-keeping ; namely, showing the efficiency
of the work done, is not obtained.
A Cost Record System Used on Flood Protection Works
at Grand Rapids, Mich. — The following system was described
by Mr. C. S. Keating in a paper read before the Illinois Society
of Engineers and Surveyors.
The administrative department of this work consisted of
a superintendent and the writer. The former had charge of
the men and of the direction and arrangement of the work.
The writer had charge of the engineering and business portions.
He had also the purchasing of all machinery, supplies, materials,
fuel, etc. ; looked after the various plants, keeping them in repair
and good running order, and attended to the renting of all
grounds, machinery, etc., and the direction of the teams.
The writer arranged and installed a cost account system.
This included a general distribution sheet for the bookkeeper's
use, cards for each division of the work (showing the amount
of work done each day and the labor cost of same), and cards
for recording minute observations for use in arranging men and
teams to the best advantage. The writer kept the time per-
sonally, so as to keep a more efficient account of the work
and check up the distribution from the cards each night with
the time for that day. He found that by keeping the time he
became familiar with the face and dress of each man, and when
watching the work, could readily tell the position of each man
and the work he was doing. This was a great help where a
large number of men were employed.
The cards used for this work were the ordinary blank filing
cards, 8x5 ins., and were ruled and marked by the writer as
fast as they were needed.
The general distribution sheets were 38 x 24 ins., ready ruled
horizontally, and ruled vertically in the office to correspond to
the various headings, as shown in Fig. 106. A tracing was made
of the heading of the sheet and blue-prints made, which were
MISCELLANEOUS COST REPORT BLANKS.
g i^
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232
COST KEEPING.
carried by the city engineer and the writer to use for reference
in writing- orders for material, etc. One of these sheets was
used by the bookkeeper and one by the writer. The bookkeeper's
sheet was used for all accounts, and the writer's sheet for pay-
rolls only. At the end of each week, the pay-roll was totaled
and checked with the distribution for that week, tabulated on
the sheet, a list made out to correspond, and sent to the book-
keeper with the time-book and tabulated on his sheet. Order
blanks were used when buying materials, etc., and the distribu-
tion numbers put on each item. These were in duplicate, one
going to the seller and the other to the office. In this manner
the bookkeeper had no trouble in keeping his accounts correctly
distributed.
Referring to the accompanying sketch of this general sheet
(Fig. io6) under the heading of superintendence and general,
/^a//y ffeporf o/ Oo//er Da/n Co/7srruc//o/t
Monrh o/_ /k'(>''</on/_ /SO 5.
^''y'- Pur /rr
TAur. tS^
3ecf)0f?y
Moreno/
leffgr/r //'I Men ^__^_^^
/ietf/f/s^ei. 6(/'^d/f!$f__ P/aci'ng \ /^'JJ{r>g imief C^i^J^ ^
Fig. 107. — Daily Report, Coffer Dam.
was charged the superintendent's salary, carfare, cost of office,
the lighting, watchman's time and part of the bookkeeper's time.
To engineering was charged the writer's time and carfare, and
the time and carfare of the field party giving lines, grades and
taking cross-sections. The remaining headings are self-explana-
tory.
Taking the cards in sequence, to correspond to the general
sheet, the first is the daily report of coffer-dam construction
(Fig. 107). This example gives the card as it appeared for
Feb. 2.2, 1906. No new sections were built or put in place, 5
sections were filled, making a total length of 80 ft. finished. Men
filling: 4 at $1.75,- 3 at $2; 4 teams at $5 hauling clay, and 3
men at $1.75 digging clay and loading. In connection with the
heading "Men Placing" it may be explained that it took a num-
ber of men to bring the sections to place (which was done by
the use of ropes), on account of the current in the river and
MISCELLANEOUS COST REPORT BLANKS.
233
A7onf/f o/_ fk^ruor^- f906.
Dat/s
A/« 0/ fftftfo/
^J^ent of Ni 0/ To fa/ Coa/ \ b</
tVoj/e
Lb3
/fun
Pu/np//>9 /or \
fnymes. £ngmeen lA/ages Lbs.
60/j
H/a//
Qyorrv^
j-M et^
j.'7t' 7,,^
1 .»/
*,ts
^'/«
*5»
ft
Fig. 108. — Daily Report, Pumping.
the swirl around the end of the section already in place. The
time for these men, which would be but a few minutes for each
section, was kept by the foreman making note of the work from
which each man was taken. In making up the distribution each
night, the time for placing was deducted from the work as indi-
cated by the foreman's report. The bags used on this work
were old grain sacks and were obtained from the various mill-
ing companies in the city at a cost averaging about $6.50 per 100.
The first example given on the "Pumping Record" (Fig.
j Da//i/ /fe^ort ,0/ Oompressor Opera//o/f.
Monfh 0/ FeJbruari/ /SO 6.
[l-y- IV
/Pressure
Aif Coa/
/^ejsure Lbs.
/funning Dr/Z/ect
o>/
Ga/j
IVaste
Lbs.
/?epa/rs
Labor
£n^/»eers
Ja/ary
,
1
II
Mill
L.___
^ir
^
Fig. 109. — Daily Report, Air Compressor.
io8) is actual, the other is merely for illustration. The amounts
of coal, oil and waste used were obtained by dividing the quantity
received at that pump by the number of days run to exhaust the
supply. The hand pumps were used for the wall only and the
steam pumps for the quarry only.
The daily report of compressor operation (Fig. 109) is
self-explanatory. The sections of "drills running" .and "feet
drilled" were used on this card for comparison. In the daily drill
record card (Fig. no) the operation of 5 drills necessitated the
Oa//^ Or/// /fecorct.
^OarcfA/9/.
Monffy 0/ rebruarif /906.
N*./3J\ fU^* yt'"'m *"*/ \J>'f'* I 7tr*f maMHmn
»*,/ XOtfii \7tfl maMHmn \k..
ffa/ii trrasrA Qar. tor* fligiij^ fiy
Fig. 110. — Daily Report, Rock Drills.
234
COST KEEPING.
Monr/r 0/ FeSr^/ary /306.
^^^' \Z'.Q
La6or
V.OJ/ a-y/Z/^/rra Y"Z^^^*^'>'f ^^'^ ^i^
y Ws.
^^y
//r3
4fny
/4H>.
Amy
TA,,. J>^<ii
£
-'Tl'
0 n 0
-ir^
0
— —
-— —
t
-4-
1 — LJ 1
Fig. 111.— Daily Report, Blasting.
use of two cards to keep the record. The number of bits used
for each drill, each day, was generally 8, there being 4 bits in a
set, and usually two sets were dulled in a day's running. The last
column is to receive the wages paid the drill runner and helper.
The daily report of blasting was kept as shown in Fig. iii.
The number of cubic feet displaced was measured on the surface,
and multiplied by the depth of the exposed face. The last three
headings for lost time are for time lost in leaving the quarry
'M0/7/A 0/ February /906.
^ l! TeomJ Miu///?^ /<>
Mfft load/hg
^e/}AesMm<j\ Oi/. yVa. /^oi'e<f to \ To /a/ \
'"'^''- \3rora^0
^rus/rer
3/i</ S/-MA/>rff.\ 3/oraaa
Grus/fer. 1 Cu. y^as.
' j
Fig. 112. — Daily Report, Hauling Rock;
while blasting, but as most of the blasting was done at quitting
time, noon and night, there was very little of this to account for.
The report of moving stone needs no explanation further
than the headings on the card. Fig. 112.
The blacksmith's report is shown in Fig. 113. As to the
"drill bits sharpened," when the bits became too dull to do effi-
cient work, they were heated, driven into a die and tempered.
As to "upset and cut," after a bit had been sharpened a few
times it became so small across the base as to bind in the hole,
Da//y /Feporf o/ 3/acA- J^yn//A
Mont/f 0/ Februari/ /906.
Fig. 113. — Daily Report, Blacksmith.
MISCELLANEOUS COST REPORT BLANKS.
235
Afo/t//t 0/ /iAruary /906.
Days.
ITrd, £f^
Engineer
,-fr,*i
O/Y. 6(t/j.
(ff<^<1k(^.
/ife/f At^i/ry
ckrax
Losf 7Tm»
Fig. 114. — Daily Report, Rock Crushing.
The
then it had to be upset, the leaves cut in and sharpened,
blacksmith made all the new bits needed.
On the crusher report, Fig. 114, the number of cubic yards
crushed was obtained by tallying the number of yards in the
bins, the amount hauled to storage, sold, and that used in the wall.
On the report of wall work, Fig. 115, the figures given are
for illustration and are not actual. The amount of cement used
was obtained by tallying the bags as they were used and checked
Dai/y ffeport 0/ iVork Ofr IVa//.
Afo/r/A of FeSruary /SOS.
Days
Bjb/j. »/
dement
Ja/>cY. V
Sz-o/re \
P/acWff
g.*,^
ft-^'^j-'i»
^.',« .y?.-' ^^M^
1
i
Fig. 115. — Daily Report, Concrete "Wall.
by counting the empty bags at night. The lumber was measured
in the forms each night by the writer. The concrete was meas-
ured in the forms and the work of each day lined out on the
outside of the forms.
The "minute observations of drilling and moving stone'*
(Figs. 116 and 117) were made occasionally to get the most
out of the drills. Also to get the best distribution of men for
loading and unloading stone, so as to cut the time lost while
the teams were standing to as small an amount as possible, while
Dn7/ /Vf.
fi^/ffu/e 06serya/fo/?s c
/f/ncf.
/
DrM/fy.
ffuff^er.
. . ^ ^/>er/tr: Ne//3eK. -. ^/>trA/: j
Aze
/yrsf B/Z 'A \5eco/K^B//- \ r^/re/ ff/t \ /bur/^ ff/r
^
^»/nar-As.
*^
Ox^^ '/l^^ 'Uc^e\ficwo
^^p ']^»f^Jhu>,r \/i^A ll<SiB^
Aa,.
^^^
^'
r [
-7-
—
\
1
1
1 1
-n
...
—
Vr^
-
1
y
y
H
:^
Ld-H
-
-
bd
bd
Fig. 116. — Minute Observation^, Drilling.
236
COST KEEPING.
kVeaf^er. • Oo/rtf/'/fo/y of ffoad. , __.
Le/tpf/r o/ //auL _. ^ /i^e/r. ^/>er/r/: Team f/ferAr
£>a^e
Loatf/'rf
l//r /cocy/hg'
=];
nam
Wfo/
W f'/f C/3.
1 f^u^^lMai/aii I'e/urf/ fos/^^ ^W/
Fig. 117. — Minute Observations, Hauling Rock.
at the same time working the men to advantage. For example:
When the number of men loading or unloading brought the
price per cubic yard above the price of a preceding observation
and the corresponding decrease in lost team time was not suffi-
cient to balance it, it was evident that there were too many men
loading or unloading and the force was decreased accordingly.
The observations of drilling were taken to get the best results
Marer/a/ /Fece/v^ecf oncf ^cce/jfect.
iVee/f ffr(^//f^ iVedf7esdai/_ J306.
'-^r
/?a^
/Fe CO/' IT'S a( /ra/rf
Ouo/}//)^
//Si/7/S-
/=>-/.. ^-^ IKiJ
1
1
L
\ __
= J
= = rJ ;
Fig. 118. — Material Received.
from the drills and keep the men from loafing when making new
set-ups or changing bits.
Under the head of loading on the stone card (Fig. 117), the
"size" gives the dimensions of the wagon box; the "time" is
the number of minutes and seconds taken to load, and the "total
time" is the time multiplied by the number of men. "Hauling"
is the time taken in going from the point of loading to the
^*
Ora/rcf ffapttf^ Af/cA. : _ .
/90 —
fi^eo /4/rrounr
For iVor/(j,f.
_ _ C/^ £/)^}it»»r
/^/r-
Fig. 119. — Order Blank.
MISCELLANEOUS COST REPORT BLANKS.
237
point of unloading and returning. The sub-headings under
"unloading" are the same as for 'loading." The number of
yards in the load is taken from the size of the wagon box, and
the cost is figured by dividing the total time multiplied by the
rate of wages, by the number of yards in the load. The total
cost will be the sum of the costs per yard multiplied by the
number of yards.
The "material received" card (Fig. 118) was used merely
as an additional check on the orders and to prevent any firm from
charging up rejected material, and to keep a record of orders
filled in part.
BOARD OF PUBLIC WORKS.
ENGINEERING DEPARTMENT.
.7081
^ ■^ ^ '^ c* e* e*
I ^
5|io|2o|3o|4o|5o
6|to|2o|30|4Q|5o
7|io|2o|3o|4ol5o
8 jio|20J3o[4o!5o
9"fio!2o[3oi40|'50
io]io|20J30|40]30
ii|iOi2o|3oi4o[5o
Sold to... I
Ground. Loaded. Delivered lo.
RECEIPT to be signed by Purchaser
and returned by Driver to Quarry.
, Driver,
Jan.|Feb.|Mar.|Apr.|May|Jun.|JuL|Aug.|Sep.[Oct.|Nov.lDec.| | j : j
jrl2lj_U I_5_|_6;|_7 |8 I 9 |io|ii|i2"h3lMh5Ti6l||||j§
17I i8| ujI 20 I 21 I 22 I 23 I 24 I 25 I 26 I 27 I 28 I 29 I 30 I 31 I j j i 1
ig|io;20|3p|40i50
I !io|2oJ3o|40|50
"2"jio!2oJ3o|40|5o
3 I K»i20i30i40|50
4"|iol2oi3o|4ol5o
S|ioi2o|3o|4o!50
6|id|2oi3o|4o|5o
7|ioi2ol30J4ol50
L
O
RETURNED R
z I LOADED
z I DELIVERED
Fig. 120.— Stone Record and Team Card.
The order blank (Fig. 119) was used in general by the
engineer's office when purchasing materials or supplies.
The stone slips (Fig. 120) were printed for this work and
served the double purpose of a sales slip and tally on the time
the teams were taking in making the deliveries. At the top is
the kind of stone, the size of the wagon, the weights, and the
scales used. Along the right-hand end are the hours from 5
a. m. to 7 p. m, and the minutes (by tens) for each hour. As
the team was loaded, unloaded and returned the time was marked
with the letter of indication, shown at the bottom, in the minute
square opposite the proper hour. At the bottom, the month, day
238 COST KEEPING.
and year are indicated by punching. Tlie body of the slip is
used for the purchaser's name, the place of delivery and the
driver of the team. The words "ground" and loaded" were
used to designate respectively whether the stone sold was loaded
from stone piled on the storage ground or loaded from the
quarry.
From these cards and slips, taken together, the unit cost
of any piece of work or any part of the work can be obtained.
This is done by assembling the various items included in the
work, from the card for that work and the items on the cards
for any other division of work that may be chargeable to that
work, in whole or in part.
For example : The cost of the crushed stone used in con-
structing the wall will be derived from the cost of crushing and
quarrying. The quarrying in turn will include pumping, com-
pressor operation, interest, depreciation and maintenance, drill-
ing and moving stone, the blacksmith's work chargeable to drill-
ing and tool repairs, the blasting, and the cost of coffer-dam.
The record of the number of men or teams or both, at work on
any piece of work for each day, gives more concise data regard-
ing the working conditions of the work, than would be the case
if merely the total amount of time for the day were recorded.
By filing these cards, with a table for each showing the
amount of work accomplished each day, together with the
average cost per day, covering any convenient length of time
or obtained after the completion of the work, excellent data
would be kept for use in making estimates on work of the same
character, making due allowance for the varying conditions.
Forms for Breakwater Construction, Including Quarrying,
Concrete Work and Dredging.* — It should be stated that these
blanks were not used by the contractors, but by the Government
engineers who wished to secure a record for their own use. Now,
it is obvious that a Government engineer is not particularly
concerned about the daily output of each worker or each small
group of workers, for it is not his province to devise a system
that will make the men more efficient. In spite of this fact,
these blanks have some good features that will serve as sugges-
tions to contractors and to engineers who are doing similar
*Engineering-Contracting, Feb., 1906.
MISCELLANEOUS COST REPORT BLANKS.
239
Buffalo breakwater construction
CONTRACT OF HUGHeS BROS. & BANGS.
DAILY REPORT OF OPERATIONS
CANADIAN QUARRY.
. _^ 190
RUBBLE STONE SHIPPED.
NO. OR NAMI or VBS<2L
TOVS.
S0.0RNAM.OFV.SStL.
TONS.
CAPPING STONE SHIPPED. |
HO. 0« NAM8 OF VESSSl
TOSS.
NO.ORSAMEOrVeSS.L.
TONS.
FORCE. NO. PLANT. No. |
Superintendent
Timekeeper
Locomotives ...,
Large Flat Cars
gines
Boiler
Boiler
Is...
-...,.....
Drillers
•Drill Helpers
Hoist Engineers
Firemen
Laborers
Engine Drivers- -
Blacksmiths
Blacksmiths- Helpers....
Machinists
Carpenters . .-
Water Boys
Watchmen
Dump Cars ..—
Coal Cars
Boxes or Skips . . .
Stationary BoUers .
Skeleton Hoist'g Er
Hoist'g Engine with
Incline Engine and
Large Steam Drills
Medium Steam Dril
Pony Steam Drills .
Steam Pomps
Derricks
Remarks : lytather. Sea, Delays, etc.
Once a meek measure each stone on one scov load of tapping stone
and note same in detail on tack 0/ report.
hispectir.
Fig. 121. — Daily Report, Quarry.
work. Those who have written articles on cost keeping have
usually been engineers, and not contractors. Hence they have
had a point of view quite different from the point of view of
the contractor. The engineer wants records of cost, principally
to furnish assistance in estimating costs of similar work in the
future. Incidentally, he wants records that can be used in case
of claims for payment for extra work, and for use in presenting
240
COST KEEPING,
BUFFALO BREAKWATER CONSTRUCIION
Contract of Hughes Bros. & Bangs.
Dally Report of Operations Stone Breakwater
190
DECK AND DUMP SCOWS.
RUBBLE STONE.
KIND OF STONB FLACED.
TO.-iS.
SEC.
RANGE.
BETWEEN STATIONS.
Small Rubble
Ordinary Rubble ..
Leveling
Totals,
NUMBER OR NAME OF VESSEL. |
-
•FORCE. NO. PLANT. NO. 1
- ••
GRAVEL. 1
NO. OR NAMB OF VESSEL.
CU. VDI.
SEC.
RANCB.
BETWEEN STATIONS.
FORCE. NO. PLANT. NO. 1
Remarks: Weather, Sea, Delays, etc.
iT-.steclcr.
Fig. 122. — Daily Report, Breakwater.
testimony in possible lawsuits between the contractor and the
owner or company whom the engineer represents. The con-
tractor, on the other hand, should keep cost records principally
with a view to reducing his costs, and incidentally with a view
to making safe bids on future work. Therefore, the contractor
who says it does not pay to employ men to keep costs for him,
MISCELLANEOUS COST REPORT BLANKS.
241
BUFFALO BREAKWATER CONSTRUCTION
Contract of Hughes Bros. & Bongs.
Dally Report of Operations Stone Breakwater
„ 190
DERRICK No.
CAPPING STONE.
KIND OP STOK« PLACSD.
NO.
SEC.
EANCE.
EETVEEN STATIONS.
H. Footing Angle
H. Revetment . .
H. Capping : . .
H. Top Angle . .
L. Footing Course
L. Revetment . .
L. Capping . . .
L. Top Angle . .
Center FUlers . .
V '
Totals,
RUBBLE STONE. |
K..VD OP STONE PLACED.
TOSS.
SEC
BANCE.
L. H.
BETWEEN STATIONS.
Small Rubble . .
Ordinary Rubble .
Total,
FORCE. NO. PLANT. NO. |
Foreman .....
Hoist Enginemen .
Swing Enginemen .
As3t. Foremen . .
Stone Pickers . .
Stone Setters ...
E
T
s
s
)errick No.
ugs _ _
cowN
cowN
0. ,
0. .„ „
Laborers
Remarks: Report invariably the vtatker, fnind and sea. Also
delays, etc.
Inspects.
Fig. 123. — Daily Report, Breakwater Masonry.
simply exposes his own ignorance of what is the fundamental
object of cost-keeping.
Let us now consider the blank records used on the work
of constructing the Buffalo Breakwater. This work involved
the quarrying of rubble stone and capping stone for the break-
water; conveying this stone in scows from the Canadian quarry
to the breakwater; placing the stone; making and placing con-
242
COST KEEPING.
BUFFALO BREAKWATER CONSTRUCTION
DAILY REPORT OF OPERATIONS
CONCRETE SUPERSTRUCTURE
190
MANUFACTURE OF CONCRETE BLOCKS AT
KIND OF BLOCKS MADE.
NO.
MATERIALS USED.
NO.
Lake Face
Harbor Face
Interior Wall
Cross-Wall Parapet . . .
Cross-Wall Banquette . .
Special
Cement Bags.
Broken Stone C.Yds.
Gravel C.Yds.
Totals,
-<:^ FORCE NO. " PLANT NO.
- . ■
'
1
Ktmnrkt: IVmI/uk, Sea, Delays, Brand of Cement, etc.
Jiisffctor.
Fig. 124. — Daily Report, Brealcwater Concrete.
Crete blocks for a superstructure; drilling and blasting out the
channel in the harbor ; and dredging the blasted material.
To obtain the cost of this work the Government engineers
devised a set of daily report blanks, seven in number, which are
reproduced herewith, two-thirds size. Each blank is 3J/2 x 8 ins.,
which is a size convenient for filing.
MISCELLANEOUS COST REPORT BLANKS.
243
BUFFALO BREAKWATER CONSTRUCTION
DAILY REPORT OF OPERATIONS
CONCRETE SUPERSTRUCTURE
PLACING BLOCKS AND BUILDING SUPERSTRUCTURt AT
KIND OF BLOCKS SET.
NO.
SF.C.
BETWEEN STATIONS.
Lake Face . .
Harbor Face
Interior Wall ■ . .
Cross- Wall Parapet . .
Cross- Wall Banquette . .
Special
Total,
MASS CONCRETE PLACED. |
LOCALITY.
SEC.
CU. YDS.
Lake Face Wall ....
Banquette Deck ....
Rem. Harbor Wall. etc.
Parapet Deck
Steps, etc.
Totals,
MATERIALS USED. |
Cement, Bags . .
Broken Stone, Cu. Yds.
Gravel, Cu. Yds
FORCE NO. PLAXT NO. 1
Remarks : Weathtr. Sea, Delays, Brand 0/ Cetiunt, etc.
Jnslecter.
Fig. 125. — Daily Report, Breakwater Concrete.
Fig. 121 gives the daily record at the quarry, includ-
ing the force employed, the plant employed, and the output
of stone shipped away. While this blank would serve well
enough for the determination of costs at the end of the month,
it is of little use to a contractor, unless the stone that is quarried
is shipped on the day that it is quarried. If not shipped on
244
COST KEEPING.
Improv
EMENT <
ACT op
^e
CONTR
Daily Report of Operations— DREDGING.
inn
narrnr
Tug
NUMBER
OR NAME OF
SCOW
LOADINQ
KINO OF
MATERIAL
Began
Finished
■
TIME ACCOUNT
CHARACTER OF DELAYS
Began
WPBK
Stopped
WOBK
Hours
Worked
Hours
-DfLAYED
Weather
WIND
SEA
WATER GAGE READINGS
Direction
Force
A. M.
N60«
P. M.
Mean
FORCE
NO.
FORCE
NO.
ENOINEMEN
CRANESMEN
FIREMEN
REMARKS:
Inspector,
Fig. 126. — Daily Report, Dredging.
the same day, the record of daily output of the quarrymen cannot
be determined from this blank. The stone was weighed by the
water displacement of the scows, giving an accurate measurement
of the total quarry output over any considerable period of time;
but, if asked, what was the exact output of the quarrymen on
Tuesday of a certain week, no answer can be obtained from such
MISCELLANEOUS COST REPORT BLANKS.
245
Improvcme
NT 0
F
"1
Contract
Daily Rei
)ort of Operations— DRILLING and BLASTING ROCK.
ion
Drill Boat
r.lT fiTA 1
Tug
1
NUMBER
Depth
Roc<
ORit-LiNa HoLe$ Blajtinq Ro<:k
Depth
Hole
ExPic
CIVES
Let.
Posi-
_L£X
Ro«
HOl-E
Drill
BECAN
FlMiMCS
T.M£
DELAȣ0
T.«E
WOOKEO
Weather
WIND
SEA
WATER GAGE READINGS |
DlRfCTIO-N
FOSCE
A M. 1 Noon
p. M
^,^^^,
FORCE
NO.
FORCE
NO.
FOREMAN
FIREMEN
DRILLERS
LABORERS
BLACKSMITH
HELPER
REMARKS:
Inspector.
Fig. 127. — Daily Report, Subaqueous Drilling.
a record. The record is, therefore, incomplete for the purposes
of a contractor, ahhough satisfactory for the purposes of the
engineer.
-Fig. 123, on the other hand, is much more complete, for it
gives the daily output of the gang working on each derrick.
Figs. 124 and 125, for recording the concrete work, are also sat-
246
COST KEEPING.
BUFFALO BREAKWATER CONSTRUCTION,
CONTRACT OF HUGHES BROS. & BANGS.
■DAILY REPORT OF OPERATIONS.
CANADIAN QUARRY.
.190..
FORCE.
STATE OPPOSITE
WHERE EMPLOYED.
Superintendent.
Timekeeper....
Foreman
Drillers
Drill Helpers
Hoist Engineers....
Firemen
Laborers
Engine Drivers
Blacksmiths
Blacksmiths' Helpers
Machinists
Carpenters
Water Boys
Watchmen
Teams
1
p
to
i
to
Remarks: Weather, Sea, Delays, etc.
Once a week measure each stone on one scowload of capping stone amd note same
in detail on. back of report.
RUBBLE STONE SHIPPED.
wo. OR NAME OF VESSEL. TONS.
Na OR NAME OF VESSEL.
TONS.
CAPPING STC
NE SHIPPED.
WO. OR NAME OF VESSEL.
TONS.
NO. OR NAME OF VESSEL.
TONS.
LoQomotives
Large Flat Cars
Small Flat Cars
Dump Cars
Coal Cars
Boxes or Skips
Stationary Boilers
Skeleton Hoisting Engines..
Hoisting Engine with Boilei
Incline Engine with Boiler.. |
PLANT.
Large Steam Drills...
Medium Steam Drills.
Pony Steam Drills
Steam Pumps
I>erricks ;
Fig. 128.— Daily Report, Quarry.
MISCELLANEOUS COST REPORT BLANKS. 247
isfactory. A contractor, nowever, would need a space for the
name of the foreman in charge of each separate gang.
Note especially that on Fig. 125 there is a column for
entering the numbers of the stations between which the concrete
was deposited. The stations were 100 ft. apart, as in railroad
work. This recording of the exact location of the work done
each day is usually omitted by the contractor who has not had
experience also as an engineer. It is a serious omission, for
the progress of all such work should be plotted on a map or
profile kept in the office, so that the contractor can tell at a glance
what work has been done each day, and where it has been done.
Coming now to Fig. 127, we find a blank that
gives more detail than any of its predecessors. We note,
for example, that each row of drill holes is numbered, and that
each hole in the row also has its number. This, when accom-
panied by a sketch show^ing the spacing and position of the holes,
gives an accurate record of the drilling work. The depth of
each hole is recorded and the number of pounds of dynamite
charged in each hole. These holes were drilled under water,
hence one column is reserved for entering the depth to rock.
We are indebted to Mr. Emile Low, M. Am. Soc. C. E.,
for these blank reports, which were prepared by him while in
charge of the Buffalo Breakwater construction. As a result
cf his experience with the keeping of records, he suggests that
it would be wise to make the blanks 7 x 8^ ins. in size, as
indicated in Fig. 128, which is the same as Fig. 121, except for
certain changes in arrangement and certain additional columns.
Fig. 128 can be folded in the middle so as to form two pages of a
note book, each 454 x 7 ins. Then the sheets can be made up into
a time-book containing 31 sheets, or one for each day in the
month. However, if it were desired to send in the sheets each
day, as would be the case where a contractor is keeping the rec-
ords, the same sheets could be used and folded in the other direc-
tion, making a folded sheet 3>^ x 8>^ ins.
Cost Keeping on Railroad Construction.* — In railroad con-
struction it is more difficult to secure proper supervision of work-
men than on many other kinds of engineering work. This is due
to the fact that the men are distributed along the line of the
*Engineering-Contracting, Sept. 25, 1907, and Nov. 6, 1907.
248
COST KEEPING,
NORRIS & PEUGNET.
DAILY RECORD. Lester, W, Vit,, 190
CLASS OF WORK
LOCATION
WEATHER
1
m
RATE 1 AMOUNT Itotal ai«t
REMARKS
$ 1 eta 1 $ 1 ctsi $ 1 ct.s
FOREMEN
.
B'R'T FWD.
i
. , . . 1 . . .
TOTAL
.:....::l....
. ,. .1
LABOR
JBfRr FORfD
—
....
TOTAL
MULES
BRT FOR'D
....
....|...;
I
....
TOTAL
....!....
-
1
HIRED TEAMS
i
BRT FOR'D
[
TOTAL
....
....!....
....
HOW MOVED
EXCAVATION
1
TOTAL
....!....
Grand Total
....
Haul in Feet
EARTH
Ca. Yds. Loads
LOOSE ROCK
Ca. Yds. Loads
SOLID ROCK
Ca. Yds loads Ca. Yds Loads
1
'
Brought fot^ard
mt. Moved
TOTAL
1
. , L. . . .
Foreman.
„
Fig. 129. — Daily Report, Railroad Grading.
road, a contractor's forces being scattered over many miles.
Under such circumstances the keeping of cost records of work
done is essential to efficiency.
Figs. 129 and 130 show two daily reports for open cut work.
They both go somewhat into details, but No. 130 more so than
No. 129. The latter has no spaces for explosives, blacksmith
or feet of holes drilled, while No. 130 has spaces for these.
MISCELLANEOUS COST REPORT BLANKS,
249
A, J. NOKRia & CO. Form*.
DAILY RECORD. Uynesvllle, Ky.,. _ 1903
EXCAVATION
Cut 1 Borrow Pit | Foundation | Drain | Side Ditch |
LOCATION
Grubbing
Clearing ||
1
z
2
1
If
Rate
n
Sta.
Sta.
Amount
(9
<
s
Brought ford.
Foremen
Men
1 1
—
1
Laborers
II
II
Blacksmith""..
Mules. Co
Mules, Hired...
Wheelbarrows
0
u
>
0
<
E
z
Is
—
^
f
t
Carts
Dump-Wag'ns
Plows -
Drag Scrapers
Wheel Scr'p'rs
3yn'mtte)Stks
Powder, Kegs
ludson, Bags..
;use. Feet.-...
Primers
Explodersj Ft.
—
1
1
-
—
—
—
1
-
—
-h
-
—
11
1
— !— J
1
1
1
II
1
1
0)
0
2
0
ill
1
III
1
1
1
Total...
1
REMARKS
'
rORCMAM.
Fig. 130. — Daily Report, Railroad Construction.
These reports are made out by each foreman for the gang
working under him, and a contractor should have but little
trouble in judging quickly if any one gang is not being handled
properly.
Figs. 131 and 132 are blanks for making a monthly resume
of the daily reports. The value of the foreman's estimate of the
amount of work done during the month on the form in Fig. 132
250
COST KEEPING.
NORRIS & PEUGNET.
MONTHLY RECORD Lester, W. Fa.,.., 1904,
CLASS OF WORK
LOCATION
ITEM
AMOUNT
REMARKS
FOREMAN
LABOR
MULES
HIF<ED TEAMS
EXPLOSIVES
1
Prop, Charges
Operaiing Ezp's
Int. eSDepre'c.
Superintendence
Sundry Expenses
TOTAL COST
1
MONTHLY
ESTIMATE
Engr's\% ^
Cu. yi/sS d;
j AMOUNTS
1"
Jj DIF'ENCE
RECEIVED COST.
-"ll AM'TS jUNITS
EARTH
LOOSE ROCK
SOLID ROCKI
1
— . 1
■
. ...
I. . .
i
TOTALS 1
' ■ ■ 1 ■ ■ '
'
tl ■
LABOR. 1
TOTAL
DAYS
CU.YDS
MOVED
CU. YDS.
PER MAN
PER DAY
1 1
EXPLOSIVES
AM'T
IN
LBS.
CU. YDS. MOVED. 1
AMOUNT
USED
»ER cu VO
EARTH
LOOSE
ROCK
SOLID !
ROCK
DYNAMITE
POWDER
JUDSON
TOTALS
^ ^ , ^
Fig. 131. — Monthly Report, Railroad Grading.
is questionable. It is the engineer's estimate that counts. The
foreman's estimate, even if made with sincerity, is more than
apt to be influenced by his desire to get a large amount of work
done, in order to make a good showing for himself.
These sheets are printed on manila cardboard and Figs 130
and 132 are reproduced natural size, while Figs. 129 and 131
are slightly reduced. The first set was used on the Big Sandy
MISCELLANEOUS COST REPORT BLANKS.
251
A. J, NOKkIS e CO. l'orm4.
MONTH LY RECORD. Laynesville. Ky., Month 1903.
EXCAVATION
Cut 1 Borrow Pit | Foundation { Drafiv
LOCATION
Side Ditch
1 Cfearing
Grubbing
F.*^
«,!
ji
1
«5
0
1
Sti,
imt £stuDAt«
"actaas'Ti
'•Raetfred ,
Cost of Work
1
Profit
tl
Losi
REMARKSr
CO»J
—
§.
■"^
•«^
r^
1-
,
s§
•s
J3Q
2
^
0
z
s4
'
e^
u
-J
<
oc
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^5
0 «C
£^
"« c
g
^
0
i4
1^
rr
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1
lo
<
0
i
0
a
S
3
0
iS
(0
s
0
0
•S5
"an
i|
?>
^
0
cs
-J
"5
cScS
•
s
CO
i
1
E
«c
CO
«)■£>
o>*j;
*;
>^
0
0
cs
bO
« 0
a.
1
1 1
1
U.
UJ
Q h- 0 1
Fig. 132. — Monthly Report. Railroad Construction.
extension of the Chesapeake and Ohio R. R., while the other set
was for use on the Deepwater Ry.
Figs. 133 and 134 are records of labor on tunnel construction
only. The original sheet was 11 X2iy2 ins. The part reproduced
shows day shift only, but on the original sheet by the side of the
day shift was a reproduction of the same form for a night shift,
the only variation being that as the stone quarry was run duringf
252
CO SI KEEPING.
DAILY LABOR REPORT.
NEW GALLITZIN TUNNEL.
P. F. Brendlincer. PENNA. RAILROAD.
CONTRACTOR, GALLITZIN, PA.
1009 Arcade Building.
Phila.. Pa. Date,-. 190..
General Force.
General Superintendent.
Tunnel Superintendent
Ass't Tunnel Superintendent
Chief Clerk
Office
Total
"~~ excavatio n— d ay shift
West End. East End
NO.
OCCUPATION.
DAY.
amount.
no.
occupation. -
per
DAY.
AMOUNT.
Heading.
Heading.
Drill Runners
Drill Helpers
Drill Helpers
Column Jackers
Mlfck" Foremen..;::"
Muck Foremen
Muckers
Timber Foiemen
Timber Foremen
Timber Men
Water Boy
W^terBoy
Lampman |
::::::::::
Lampman
— 1 — - —
Bench
.
L
Fnrpmpn"'"
Timber Men
Muckers
Drivers
Water Boy
Mvickers
Waterboy
Nipper
Nipper.. . 1
^h" i'r*^'-
Brakesmen
Blacksmith
Blacksmith Helper
Blacksmith Helper
Watchmen
Compressor Engineer.
Machinist
Mechanical Engineer.
.... 1 .
Carpenters . jj . ■ • • • •
•■••
L-arpenter s neipers. .
■•••
....
Drill Helpers
■■
Drill Helpers .
Total... .1 1
Total 1
!....
M A S O N R Y— D AY SHIFT
East End
OCCUPATION.
Rubble Side Walls
Foremen
Masons
Mason's Helpers
Laborers
Mortar Mixers
Dinkey Runners ....
Dinkey Brakemen.. .
Total
Concrete.
Foremen
Skilled Laborers
Inside Laborers. . . .
Outside Laborers. . .
Hoisting Engineers.
Dinkey Runners . .
Dinkey Brakemen..
Total..
portal.
Masonry Foremen. .
Masons
Mason's Helpers
Laborers
Hoisting Engineers.
Mortar Mixers
OCCUPATION.
j KATE
j PER
Rubble Side Walls,
Foremen
Masons
Mason's Helpers
Laborers
Mortar Mixers
Dinkey Runners ....
Dinkey Brakemen.. .
Total |.
Concrete.
Foremen
Skilled Laborers...
Inside Laborers. . .
Outside Laborers...
Hoisting Engineers
Dinkey Runners . .
Dinkey Brakemen.
Total.
Portal.
Masonry Foremen. .
Masons
Mason's Helpers
Laborers
Hoisting Engineers.
Mortar Mixers
Total.
Total.,
Quarrymen.
Day Shift.
Quarrying Stone.
Foremen
Quarrymen
Fig. 133. — Daily Report^ Tunneling.
MISCELLANEOUS COST REPORT BLANKS.
253
RECAPITULATION.
GENERAL FORCE.
Day.
»
Cts.
West End Tunnel 1
Night
East End Tunnel ,
Oay
Night . . .■
West End /Day..
RUBBLE SIDE WALL.
Night
Kaif Knd Dav
Ni«ht
• •.
lEast End
West. End Tunnel
East End Tunnel
CONCRETE MASONRY.
fDay.>
Night
Day
Night
^
■
'
Total
Previous
Total to Date
••
Signed
. . . Chikp Ci.RnK.
Fig. 134. — Daily Report, Tunneling.
the day only, this did not appear in the night shift's report. The
form is large and rather cumbersome and does not show details
of progress of the work.
All these forms are subject to the criticism that the reports
can not be made in duplicate on carbon copies. This is an im-
portant feature in cost keeping, for obvious reasons.
Mr J. P. Hallihan, of El Paso, Texas, has described the
following system which shows great care and ingenuity in its
devising and includes some excellent forms.
While it is not always necessary that the engineer should
have a complete cost-analysis, showing subdivision of cost per
unit of measurement, it is required that the cost per unit in vari-
ous locations, as in each cut, should be at his command, as well
as the manner of handling, disposition of material and time con-
sumed.
Force reports in use in railroad work are not designed to
secure this information, except in a very general way, usually
giving a mere statement of force employed each day, without
regard to costs.
The accompanying forms were used on some recent work
in the Southwest, and were intended to collect all the data re-
quired in shape for condensation or further analysis, but the
initial form was made as simple as possible, calling for no calcu-
lation on the part of foremen.
254
COST KEEPING.
The field report (shown as Fig. 135) is bound in books
of 35 dupHcate sheets, colored white and yellow, the white sheet
being perforated for removal. In the case of company work, the
FOREMAN'S DAILY TIME REPORT.
Work done on sect.
By
...190...
.Foreman,
Between sta and sta.
Time. Ratg,
. 4-plow. . .
. 6-plow. . .
.&-pk)w...
.Slip
. Fresno. . .
.Wheeler.
. Snatch . .
.Supply. . . .
. Cart
. Stone boat.
. Wagon . . . .
.Car
.Water
.In corral...
Material Used.
Pounds
of
Dynamite.
Kegs
Black
Powder.
Feet
of
Fuse.
Number
of
.Caps.
No. and
length of
Exploders.
Sacks
of
Cement.
Liters
Black
Oil.
Liters
Class of work:
Clearing. Excavation. Earth.
Borrow. Waste.
Timhel No, Structure No.
Cross out wprds not necessary to express nature of work.
Loose rock. Solid rock.
Haul Meters.
(over)
Distribution of Labor.
No.,
Employe.
Time.
Rate.
Sub- Foreman ....
Drillers
Blacksmiths
Blacksmith Helpers
Timbermen . . ....
,
Miscellaneous:
Work done, etc
'
Foreman.
Foreman will fill this blank out daily and forward to timekeeper.
Fig. 135. — Daily Report, Railroad Grading.
MISCELLANEOUS COST REPORT BLANKS.
255
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256 , COST KEEPING.
form is filled in duplicate, using carbon, then torn out and the
information called for on reverse side (distribution of labor and
foreman's estimate of material moved or work done) is filled in,
carbon impression being taken on reverse side of sheet retained
in book. The sheet is then deliverd to the timekeeper, who checks
the time given on report against the time which he has personally
taken, and forwards report to the division engineer. On isolated
jobs, or with small gangs where no timekeeper is employed, the
report goes direct to general foreman or division engineer. At
the end of the month all books are sent to office of division engi-
neer, who is thus put in possession of the original record of each
day's work.
Where work is being done by a contractor, the data are ob-
tained by force reporter using same form, omitting, of course, tke
names of employes, and noting only the total number of each
rate. The other information is obtained from foreman's state-
ment, checked by personal observations.
Fig. 136 is a condensation of daily reports into a weekly
report, showing distribution of force on each section and
total cost for period covered. Quantities moved may be closely
approximated from daily reports and profiles and inserted in
weekly report, if desired.
Accurate statement of quantities moved is, however, shown
on the monthly sheet (Fig. 137) as derived from engineer's
estimates. Fig. 137 also shows total force and cost for
month of work done on each section. It can also be arranged to
show grand total cost of each section since commencement of
work, and, for the use of a general contractor, this would ob-
viously be required.
The daily report form is used for all classes of work, the
weekly and monthly reports being printed to conform to nature
of work and information required.
Cost Keeping System of Fred T. Ley & Co., Inc., of
Springfield, Mass,* — We take up the system of Fred T. Ley &
Co., who, as will be seen at the close of this article, have built
many miles of electric railways, conduits, etc. The editor visited
one line of railway work being done by this company some years
ago and found that a very careful system of cost keeping was in
♦Engineering-Contracting, April, 1906.
MISCELLANEOUS COST REPORT BLANKS. 257
use. Since the visit of the editor, the company has developed and
improved its system, and, like all other firms of contractors who
have once perfected a cost-keeping system, nothing could induce
them to adopt the guesswork plan of cost-keeping.
Before describing the record blanks used by Fred T. Ley &
Co., it is well to point out that their work has often been of a
kind most difficult to keep track of. Frequently it has been
strung out over twenty miles on one contract. Now, it is obvious
that a system which is designed for use on work that is concen-
trated within a limited area, may need decided modifications when
applied to scattered work. The features of the Ley system can
best be understood from a brief description of the record blanks
and their use.
The timekeeper takes the time of each gang on Blank No. la
(Fig. 138a). He uses a separate sheet for each separate gang of
men. He puts down each man's number, the hours worked and
the rate per hour. One sheet holds the names of 30 men be-
sides 14 teams. These sheets are bound in a loose-leaf binder, as
indicated by the holes. On the reverse side of each sheet is
Blank No. ib (Fig. 138b), which is filled in so as to give the
total cost of the day's work of the gang, the amount of work
done, the location of the work, and the haul. In this case the
work was located between Stations i and 8; the haul was 500
ft., and the output was 200 loads of gravel, at a cost of $41.48.
Thus we have the cost of the w'ork done ]Marcli 15, on the cut
between Stations i and 8.
On every large job there are many general expenses that
must be distributed over a number of gangs of men ; for example,
the salaries of superintendent, timekeeper, etc. These miscel-
laneous charges are entered on a "miscellaneous sheet" like
Fig. 138a, and the total is divided up among the different
pieces of work, pro rata. Thus, Fig. 138b shows that $2.48
was charged from the miscellaneous sheet.
On large contracts, the timekeepers make out a daily report.
Blank No. 2 (Fig. 139), which gives the total expense each day
of the entire contract; and the total of the small detail sheets
(Blank No. ib) must agree with the total of this large sheet.
When the timekeeper takes his time in the morning, he gets
from each foreman a supply report filled in on Blank No. 3
(Fig, 140). This gives the amouiit v)f material used the day be-
258
COST KEEPING.
TIME SLIP
^C.
CONTRACT
NUMBER
.yuta.
HOURS
/o_
RATE
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'T4<aA..l.T x^o6~
NUMBER HOURS
RATE
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MISCELLANEOUS
Fig. 138a. — Front of Timekeeper's Sheet.
MISCELLANEOUS COST REPORT BLANKS.
259
FRED T. LEY & CO.. Contractors.
TTioA... LT
9a
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FOREMAN
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MATERIAL
AMOUNT OF WORK
2{^ ,Af-tJu<:^
REMARKS
WCATHEW
Fig. 138b. — Back of Timekeeper's Sheet.
26o
COST KEEPING.
Contract No.
OAI
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HELP EMPL
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MISCEULANFOUB
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Total Pay Roll,
•
Time Keener. |
Fig. 13J. — Timekeeper's Daily Report.
fore on each particular kind of work. The timekeeper sends in
these supply reports with his daily time slips.
When the reports are received in the office, they are first
turned over to the pay-roll clerk, who tabulates the time. When
he is through with them he turns them over to the record clerk,
who records them on the proper sheets. When the pay-roll is
made up every two weeks, its totals must agree with the totals on
the time slips.
MISCELLANEOUS COST REPORT BLANKS.
261
A summary of the time slips (Fig. 138b) is entered on
Blanks Xos. 4, 5 and 6 (Figs. 141, 142, 143), a separate blank
being used for each cut and for each separate gang of men.
Thus, Fig. 141 shows the cost of excavating and filling be-
tween Stations i to 8, by days beginning with March 15. We see
that the total number of loads was 200, and that the cost per load
was $0,207. There is room to enter 29 days' work on the front
side of each of these blanks, and as many more on the rear side.
At a glance it can be seen what each day's work has cost per
load, and the contractor is in a position to detect any increase or
decrease in the cost, from day to day. This enables him to dis-
SfA'flOlV. 190.
SUPPL>
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Fig. 140. — Daily Supply Report.
cover inefficiencies in men or methods — not weeks after the work
is done, but the day after.
Fig. 142 is essential!}- the same as Fig. 141, except-
ing that columns are provided in which to enter cost of dyna-
mite and exploders. The number of feet of hole drilled each
day is also recorded, and the number of loads of rock hauled.
Fig. 143 is for concrete work, and is self-explanatory.
Blank Xo. 7 (Fig. 144) is the pay-roll blank, and needs no
explanation.
In looking over these blanks we note especially the provision
made for recording the work done by each gang of men at each
cut, each culvert or bridge, etc., along the line of the work. The
blanks are very simple in form, and the system is so flexible that
262
COST KEEPING.
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263
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264 COST KEEPING.
it can be extended to cover many classes of work. The recording
of earth and rock excavation by wagon loads or car loads h not
absolutely accurate, due to the variation in sizes of loads; but
when the number of loads is checked by cross-sections of the ex-
cavation, it will be found that the loads average a certain tolerably
constant yardage under given conditons, and, by a little care, the
contractor can be quite sure that the foreman is not sending out
light loads so as to make a good record for a day's output.
Fred T. Ley & Co. do a great deal of work on the percentage
basis, but they keep just as careful a record of cost on percentage
work as on regular contract work, not only because they want to
keep the unit cost down as low as possible in behalf of their
clients, but because a client is able to visit the work at any time,
count the men in any gang and check the accuracy of the time
keeping for himself.
Record Card for Railway Section Foremen.*— The diagram,
Fig. 145, is a record card to be used by section foremen, and it
shows the day's work done by a gang of section men. The ver-
tical lines, or ordinates, show the hours of the day from 7 a. m. to
6 p. m. and the intermediate quarter hours. The horizontal lines,
or abscissas, show the number of units of work accomplished.
The black circles are holes punched with a condiictor's punch.
The lines connecting the punch holes can be ruled in after the
day's work is done.
This particular card shows that the gang of men arrived at
the site of the day's work and started in at 7 130 a. m. At 10
a. m. they had completed 10 units of work, and the key letter S
on the straight line between 7 130 and 10 a. m. is found to be the
number of rail lengths of track surfaced and lined. At 10 a. m.
the gang began putting in ties, as is indicated by the key
letter T on the straight line between 10 a. m. and 12 m. Then
the curve of work rises vertically from 12 m. to i p. m., indi-
cating that no work was done during the noon hour. From i
to 2 p. m. the work of putting in ties was continued. At 2 p. m.
the gang began cutting grass, as is indicated by the key letter G,
and quit at 5 p. m., having cut grass for a distance of 55 rail
lengths. Then the curve of work rises vertically from 5 to
^Engineering-Contracting, July 17, 1907.
MISCELLANEOUS COST REPORT BLANKS.
265
6 p. m., and the key letter D^ shows that this hour was lost in
picking up tools and going home.
It will be noted that a card of this sort gives a perfect log
of the day's work, showing all delays, their cause and duration,
and number of units of w'ork accomplished. On the back of the
card a series of key letters should be printed so that the fore-
Dau
I907
Number Man
<;t>rt,nn Nn
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5
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L/n,/s of Work
Key fo Work Key to Losf Time
5 = Surfacing and lining, rail lengths D = Dinner time
T = Puffing in ties, number Di = Gomff fo tvork '
6 - Cuffing grass on ngfif-ofway. rail lengths Da = Putting up fools and going k
0
Hyne.
Fig. 145. — Daily Punch Card Record of Railway Section Foreman.
man can indicate on the curve of work any kind of work done,
and the units in which it is measured. The rail length is a con-
venient unit for certain classes of w^ork, the distance between tele-
graph poles may serve for other classes. Incidentally, all tele-
graph poles on each section should be numbered consecutively.
Then the foreman can be required to report the exact location of
266 COST KEEPING.
the work by putting the number of the pole on the curve of work
diagram.
The card shown herewith is obviously applicable to innumer-
able kinds of construction or manufacturing where men work as
individuals or in gangs. It becomes complicated when a gang
under a foreman is split up into smaller gangs which are con-
tinually shifted from one kind of work to another. But such
shifting is usually unnecessary, and can be obviated, as a rule, by
the use of better judgment in the management of the work. In-
deed, this very objection to the use of such daily card reports
points the way to better management by indicating the lack of
reason for splitting gangs up into small units that putter away
time.
A Cost-Keeping Book-Keeping System for Pipe Line
Work. — Mr. W. W. Cummings, M. Am. Soc. C. E., has de-
scribed in Engineering Nezvs for October 2, 1902, a system of
cost-keeping bookkeeping, which description we herewith re-
produce :
It often happens that an engineer is confronted by the prob-
lem of doing a certain amount of work with a limited sum of
money, and the only way he can keep the cost within the required
limits is to so systematize the reports that he can see at any time
what the expenses are for the different items and trim them ac-
cordingly. In the ordinary methods of bookkeeping, unless a con-
siderable force is kept on the accounts, the knowledge of exces-
sive cost is obtained too late to be of much benefit to the work
in hand.
In the construction of the Massachusetts Pipe Line Co.'s
mains, the writer had occasion to regret that no previously tried
system was available, and after considerable study devised the
following methods, which may possibly be used as a base in
similar cases.
When the Massachusetts Pipe Line Gas Co. commenced to
lay its mains, it was given a limit of cost of $9 per lin. ft., com-
plete, which was to include all repairs and changes to other pipes,
conduits, sewers and paving. Much of the route was through
districts congested by travel above and obstructed by existing
structures below.
The work consisted of laying: 2^ miles of 42-in. pipe, laid
in a double line; 33/2' of 36-in., double; i>^ of 36 and 30-in., side
MISCELLANEOUS COST REPORT BLANKS. 267
by side ; 7 of 36-in., single ; i of 24-in. pipe, single. Also three
river crossings. Three contractors were employed on the
work.
Rates of labor were as follows:
Foreman $0.45 per hour.
Subforeman 35
Siibforeman 30 " "
Bracers 25 " "
Calkers 25 " "
Pavers 4.00 per day (9 hrs.).
Tenders 2.00 •" "
Laborers : Derrickmen, bottommen, bracers' tend-
ers, pavers' tenders, pipe lavers, leadmen 20 per hour.
Laborers ' 18 " "
Laborers 171/^" ;'
Laborers 17 " "
Laborers 16 " "
Laborers 15 " "
Blacksmith 20 '* "
Blacksmith's helper 15 '* "
Lampman 15 " "
Toolman 20 " "
Watchman 15 " "
Carpenter 25 " "
The office force consisted of:
1 bookkeeper $60.00 per month.
1 time-keeper for each contractor 80.00 per month.
1 time-checker for each gang , . . . 12.00 per week.
1 engineer for each contractor 75.00 per month.
1 rodman for each contractor 50.00 per month.
1 yardman for each yard 60.00 per month.
The timekeepers and checkers were men selected for their re-
liability and diligence and were paid good wages. The checkers
patroled the line at irregular intervals, at least every two hours,
and returned a slip to the timekeeper, showing the men and teams
at work each trip with the date and time on each slip. The entire
route was mapped and separated into divisions and sections.
The different cities constituted the divisions, and were let to dif-
ferent contractors, while the sections were divided according to
the anticipated character of the work. That which required
piling being one section, that containing rock cut another, where
the line crossed private land, passed under the various kinds of
street surfacing, was near a railway, etc., each a distinct section.
The idea being that the cost of these different classes of work
would show in the reports of the sections without further sep-
aration.
268
COST KEEPING.
Five receiving yards were established along the line, where
all pipe and material were delivered. Here the pipes were in-
spected, and a number was marked on the inside of each one with
white lead.
A report. Fig. 146, was made in triplicate, containng this
data, together with an account of everything shipped from the
yard, the division, section and foreman shipped to and the team-
ster hauling the load. One copy of this report was sent to the
office daily, another was forwarded to the auditor and the third
remained in the book as a record. The timekeeper was required
to return a daily report for each gang, made in duplicate, show-
MASSACHUSETTS RIRE LIINE GAS CO.
DAILY PIPE REPORT.
V^tcciot-d into
-^■^-
7-ctr.
.18S9..
,gHTS ANg n mim ^umbf.rS
1.7 iO
J-a-t-j- .T/70
<So Fx)
yWASSACHUSETTS RIRE LINE OAS CO.
DAILY, PIPE REPORT.
Fig. 146. — Daily Pipe Report.
ing the number of men of different classes employed, the rates of
wages, the daily wages and the total wages to date, on each sec-
tion on one side, while a list of the tools in use with the daily and
the total rentals, if any, were shown on the reverse side. He also
noted on this card the numbers of the pipes received and their
condition, and the other material received. This report guarded
against loss of tools and material in transit to the work.
Of course the total daily payroll of the card checked that of
the time books. Figure 147 describes this report.
The division engineer was required to return daily reports
for each section (Fig. 148) made in duplicate, showing the exca-
vation, back-fill, paving, repairs made, material used, the num-
bers of the pipes laid in their order, with remarks covering
MISCELLANEOUS COST REPORT BLANKS.
269
anything that would affect the cost. This guarded against the
loss of material while on the ground. Both the engineer's and
timekeeper's reports were cards of convenient size for the coat
MASS.
PIPE LINE GAS CO.
Foreman.rZxrf,^MXUt.. 's Report No...,a/
Work Date.ktL -J j.f.^J
l-oicinen
No.
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Reverse Side.
Fig. 147. — Daily Payroll Report, Pipe Laying.
pocket, and stiff enough to avoid crumpling, bound in book form,
perforated, and having a thin sheet of parchment for the
duplicate.
At the office the bookkeeper entered the pipe as ordered and
270
COST KEEPING.
the data from the cards on a page (Fig. 149), which gives the
pipes ordered, received, to come, dehvered to each section, laid
in each section, on hand, and the length as obtained by average
laying length (used as a check).
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Fig. 148. — Daily Progress Report, Pipe Laying.
Nearly all the pipe and specials were ordered from the
McNeal Pipe & Foundry Co., and the R. D. Wood Co., and the
columns headed "McN." and ''W." refer to the castings from
those dealers.
The bookkeeper also had a ledger account in detail (Fig.
150) which he took from the reports showing the material re-
ceived, used, and transported from each section. This account
MISCELLANEOUS COST REPORT BLANKS.
271
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MISCELLANEOUS COST REPORT BLANKS. 273
served to simplify the entries to be made on the page ruled, as in
Fig-. 151, and further guard against loss.
In practice the daily report cards from the yards, the time-
keepers and the engineers, were mailed the evening of the day
recorded and reached the office at 8 a. m. The bookkeeper made
his entries on the pages, described by Figs. 149 and 150, and
transferred his totals to the page, described by Fig. 151, which
made the information in detail for the day recorded available by
noon of the following day.
The results were combined in a similar manner for each
division, as shown by Fig. 151, and again for the entire work.
These totals were made up each week unless required oftener by
the bad showing.
The bookkeeper also compiled a record of the pipe from the
yard keepers' and engineers' reports on a page ruled as shown in
Fig. 152, by which any lost pipe could be traced and damage
assessed.
A ''Division of Labor" sheet, showing the cost of the differ-
ent items, was sent to the auditor each week. He also received
the bills, and kept independent accounts. A daily report, de-
scribed by Fig. 153, was sent to the president and chief engineer.
The division engineers also kept field books, giving the grade
and laying length of each pipe, and the pipe numbers, in the order
of their laying. The intersections of cross street lines and im-
portant underground structures were noted by station, the loca-
tions of each special were tied in to permanent points and the
lateral distances from street lines and other pipes, sewers, con-
duits, etc., were noted.
When repair work was done by city men, a report of the
labor, materials and prices was added to the engineer's card,
together with the location of the repair. This was credited to the
city on a page for that purpose, and when the bill was pre-
sented it was ''O K'd" from that page.
The highest cost per lineal foot of pipe was $11.61, including
all repairs, pipe, etc. This was one 36-in. pipe in rock cut, with
a i2-in. gas main on one side and a water pipe and sewer on the
other.
The lowest total cost per lineal foot of pipe, for two 36-in.
pipes side by side, was $8.16; do., for one 24-in. pipe, $4.29.
The average total cost per lineal foot of pipe was $8.36.
274 ^^^^ KEEPING.
The average total cost of pipe per lineal foot was $4.20, in-
cluding specials.
The cost of pipe per ton was $17.50 f. o. b. Philadelphia.
The cost of specials was 254 c per lb.
The average cost of excavation (including sheeting) was
$1.86 per lin. ft.; for laying (including lead, etc.), 62c; back-
filling (including surfacing), 72c; handling (includes unloading
cars and piling in yard) was 76c per lin. ft.
MASSACHUSETTS PIPE LINE GAS COMPANY.
July 7th, 1899.
FAIR:
Mr. Cummings in office 8:10. Tunnel, Boston, Rox-
bury, Brookline, Cambridge, office 5:45. Sullivan in
office 8:10, 95 Milk St., office till 5. Tabor in office and
works all day. Silsbee and Jeeves in office all day.
Murry and assistants in Roxbury, Brookline and Jamaica
Plain. Hayden and assistant in Cambridge giving grades.
Div. D. Sees. 1 and 2, Cambridge.
Laborers 233 Engineers 2
I^arpenters 3 Pumpmen 20
Blacksmiths 1 - — •
Night watchmen 12 Total 270
Day watchmen 10
Derricks 1 Supply wagon 1
Furnaces 2 Single carts 1
Blacksmith kits 1 Double carts 4C
Pumps 5
302 lanterns out. Sec. 1, %-yd. concrete, 140 sq. yds.
paving, 60 ft. edgestones, 114 yds. brick laid, 45 ft. pipe
raid, 8 joints, calked, 8 pigs lead used, 1 sewer connection
made— 25 ft. 5-in. pipe, 1 6-in. % bend used.
Sec. 2. 175 ft. trench opened, 75 ft. back filled and pud-
dled, 268.84 ft. pipe laid 17 joints calked, 15 pigs lead
used, 15 piles driven, 8 caps used.
Fig. 153. — Daily Report to President.
This does not include engineering other than as above men-
tioned. The location sheets were as shown by Fig. 154, giving
the station of the side streets and specials, with the lateral dis-
tance from street lines and other pipes, conduits, etc., wherever
obtainable. Each special is tied in from permanent points, so that
any joint can be found by locating a special and measuring the
distance given in the field books, while keeping on the ofifset
from the street lines.
A further compilation was started, as outlined in Fig. 155,
which is modeled on the form used at Halifax, N. S. This gives
at a glance all the information connected with the line, but
requires a great deal of time. In the case of the Massachusetts
Pipe Line Gas Co., it was reserved for winter work.
In case of repairs and leaks, slips (Fig. 156) modeled after
those of the Boston Gas Light Company, W. R. Addicks, engi-
MISCELLANEOUS COST REPORT BLANKS.
275
2/6
COST KEEPING.
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MISCELLANEOUS COST REPORT BLANKS.
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COST KEEPING.
neer, arc filled out and filed in a card index under the heading of
street names.
Each drip is numbered from the Everett works and a record
(Fig. 157) is kept of the depth of drippage and the gallons
pumped each visit. The drip wagon contains about 200 gallons,
and has a float whose spindle is marked every 25 gallons. By
tabulating for each drip the measurements in inches and the num-
ber of gallons pumped, it was easily seen about how much drip-
page there was for each inch, even though the water extended
into the pipe (which is often the case in some drips where the
pipes have a slight fall), so that a measurement now gives the ap-
MASS. PIPE LINE GAS CO.
/S99 /900
°j:l month
DAY
GALS.
Depth MONTH
DAY
GALS.
D.p,h
MONTH
DAY
GALS.
Depth
MONTH
DAY
GALS.
Depth
/
^y^/y^
^rt-
r^'
.TT-
^a^,-3o
't7u^
Jo-
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^
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10 •
'-
L.''\^_^
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'— - — ^
Fig. 157. — Drip Record.
proximate gallons to be pumped. Each valve is lettered from
the works.
These drips and valves are located in the usual way by sten-
ciling rectangular co-ordinates on permanent nearby points. All
drips are sounded and the valves started once each month.
It would be unfair to close without tribute to the resource-
fulness and push of Mr. L. J. Hirt, who was the chief engineer
during construction.
Cost Keeping System of the Kosmos Engineering Co.,
Nqv/ York City.-'' — The system about to be described differs
materially from any of the systems previously illustrated. It should
be stated in advance that the Kosmos Engineering Co. has the
contract for building the Brooklyn anchorage for the Manhattan
Bridge, the new wire cable suspension bridge across the East
River at New York City, and that the blanks shown in this article
were especially designed for that work. The system, however,
is of general application, as will be noted later on.
*Engineering-Contracting, March 13, 1907.
i
MISCELLANEOUS COST REPORT BLANKS. 279
The first noteworthy feature of the Kosmos system of cost-
keeping is the absence of blanks to be filled in by the foremen.
The foremen are provided with pads of paper on which they write
each day the number of men in the gang and their respective
duties and rates of wages. If the work is of a kind that admits
of easy measurement, the foreman reports also the amount of
work done. On the whole, however, very little is required of the
foreman except a statement of the number of men, their occu-
pation and the rates of wages. These he can give on any slip of
paper, no printed blanks or rules of procedure being insisted
upon.
The foreman's report with the timekeeper's book go each
day to the bookkeeper. They, of course, must total up the same
amount of daily pay account, and it is the bookkeeper's business to
verify this fact. The verified records and time sheet go next
directly to the superintendent's assistant, who analyzes them
and distributes the costs to the proper accounts. The superin-
tendent's assistant is himself a civil engineer capable of checking
all measurements and estimates of quantities. The office is
directly on the work so the assistant sees every part of the work
himself several times daily. In a word, all analysis of costs is
done in the office of a competent man, who is, moreover, in con-
stant touch with the construction work, and so does not require
a very elaborate report from the foremen.
Now as to accounts. In this particular contract all costs
are charged under six general headings to a number of different
items, each of which has its account in the ledger. Of course,
the items vary somewhat from time to time, but the accompany-
ing schedule gives a generally fair idea. Keeping to the labor
accounts for the present, the superintendent's assistant, in analyz-
ing the foremen's reports and time sheets, records his distribution
of costs on blanks 9% x 6jA ins. in size and of the form shown
in Fig. 158. These blanks are kept in a filing case and are avail-
able for inspection at any time and give a complete record of the
labor cost of the work at any time.
The pay-roll vouchers are made out every two weeks and
are made out from these blanks. The totals from the blanks are
recorded on the back of the voucher in properly ruled spaces.
Thus each payroll voucher is its own record not only of the total
28o
COST KEEPING.
KOSMOS CNGINECRINa CO.
■ ROOKLTN. H. «.
CONTRACT No. 1
LABOR
GRANITE
DATE Unloading ud Distributing
DRESSING
TRANSPORTING
Ho,s,ing.ndS«ting
1
COST
COST
-
COST
COST
COST
1
1
KOSMOS ENGINEERING CO. CONTRACT No. 1
■ ■OOKLYN. H. ».
LABOR
EXCAVATION.
DATE LABOR IN PIT
STONE BREAKERS
TRANSPORTATION || ^.^f^f^GVcoVs
BACKFILLING
COST
COST
•» 1
COST
COST
-'l 1
~
i 1
CONTRACT No. 1
LABOR
CARPENTERS. ELECTRICIANS.
DATE CONCRETE FORMS
ARCH CENTERS
CONTRACT No. 1
LABOR
FOUNDATION PILES, SHEET PILES AND BRACES.
FOUNDATION PILES
CONTRACT No. 1
LABOR
CONCRETE
CYCLOPEAN
DATE
MIXING
Trinsportiog
Hoisting and
Depos.l ng
TOTAL
CU YDS.
CostCu Yd
Hoisting and Salting
CU.YOS.
Cost
CuYd. ,
CONTRACT No. 1
LABOR
UNLOADING AND HANDLING CONCRETE MATERIALS.
CONCRETE STONE
Fig. 158. — Blanks for Distribution of Costs.
MISCELLANEOUS COST REPORT BLANKS.
281
KOSMOS ENGINEERING CO.
DAILY CEMENT REPORT
_ — IM
■OOrBM*
.2SS.
«J»S.
•M
TOTll
On huul (tort of rfay
C«ddorio,d.y
On hrnnd doM of d«T
" • Beceired
■^z.\\y Cement Report.
payroll, but of the items making up that total. These vouchers
go to the bookkeeper and from them he takes the amounts to be
charged to the several accounts. The bookkeeper merely tran-
scribes the amounts.
So far reference has been had entirely to the labor cost ac-
counts. The bills for materials, supplies, etc., are also analyzed
by the superintendent's assistant, who proportions or distribute?
the costs to the proper accounts. This distribution is given on the
back of the voucher for every bill, and here again the bookkeeper
has simply to transcribe the several amounts to the proper
accounts.
The foregoing covers the main scheme for keeping costs. Its
noteworthy features are that the foremen are called upon to do
only the simplest kind of record-keeping and that the analysis of
costs and their distribution to the proper accounts are performed
by one of the regular engineering staff who is in constant touch
with every detail of the work. It is evident that the system as
described for one specific job is applicable to general contract
work by making obvious modifications in details.
KOSMOS ENQNEERING CO.
EMPTY BAG ACCOUNT
Report for_
No. empty bags in stock
190
at start o£ nork.-
No. of eippty bags plac<>d
in stock daring dajr_
N'o of empty bags
shippetLduringday
No of empty ba;?8 on
hand at clote of day-
Signed.
Fig. 160. — Daily Empty Bag Report.
282
COST KEEPING.
DAILY COST OF ELECTRICAL CUfU<ENT CONSUMED.
Meter No.,i. Anchorage, Pr«sent-
•' a. Mixer & Docks"' _
'• }. Railorad ■• _
■' 4- Arc Lights " .
Total Watts consumed :
Mixer & Docks
•• '* »• Railroad ^ .
'• Arc Lights
Time Previous Readings. A. M.
•■ Present " _A. M.
Remarks ^ — ^ . J...
Signed
Fig. 161.— Daily Record of Electricity Used.
Besides the labor cost blanks shown in Fig. 158, the Kosmos
Engineering Co., on the work referred to above, make use of a
variety of other blanks for keeping the daily run of expenses and
the condition of the stock of supplies and materials. Figs. 159
and 160 show the blanks for keeping track of the cement stock
and the empty bag account. Fig. 161 shows a blank for keeping
tab on the daily cost of electric current consumed. This serves
the purpose of checking up the bills rendered for current and of
detecting waste or other neglect. In a similar way, by means
of the blanks shown in Figs. 162 and 163, a daily record is had of
the work done by each motor car and hoist. Each hoist, derrick
and motor is also inspected at frequent intervals and there are
blanks for the inspector's reports. The operators of the several
machines also have blanks on which they are required to report
needed repairs. In a word, the company strives to know by actual
reports the condition every day of its machinery, tools, supplies,
etc. These detail records are, of course, not absolute essentials
of the cost-keeping system proper, but they combine with that
system to make every detail of the work efficient.
MOTOR CAR NO. .
Time Finished —
No. of Hours at
Cost for-Day
No. of Cars in Train
No. of Trips ■—.,
Kind of Material hauled
Amount of Material hauled-
-A. M.
.A. M..
-P. M.
-P.M.
Fig. 162. — Daily Record of Motor Car Performance.
MISCELLANEOUS COST REPORT BLANKS.
283
HOIST 1^0
Date
- =
Timr Finhhrd
A. M P. M
1
Mali^il Himffnl
Fig. 163. — Daily Record of Derrick Performance.
Blanks for Recording Work of Well Drills as Used by the
Nevada Consolidated Copper Co.* — Recording the work done
in concise and convenient form is a very important item in
DRIL.L. REIOORD
Nevada Consolidated Copper Co.
For the Shift ending 190 .
Previous depth of hole
Present depth of hole
Number of feet drilled
Hours drilled
Hours Lost
Barrels of water used
Cords of wood used
Formation
Location of Hole
Number of hole
Drill man's wages
Helper's wages S
Cost per foot of drilling this "shaf S . .
REMARKS:
■ SIGNED
FOREM.A.N
Fig. 164. — Daily Record of Test Hole Drilling.
prospecting with well drills. Daily time cards should be filled out
by each drill man as he comes off the shift. Sample cards are
shown by Figs. 164 and 165. The card shown in Fig. 164 is
for recording the cost of the work and that shown in Fig. 165 is
for keeping a general record of the work. From the daily time
cards the superintendent makes up his report to the company at
the completion of each hole.
*Engineering-Contracting, July 3, 1907.
284
COST KEEPING.
Form for Keeping Account of Cars of Materials.* — Mr.
George R. Humphre}^ member of the firm of Joseph Ross Co.,
bridge builders and general contractors of Boston, Mass., sends
DAILY DRILLING RECORD
Nevada Consolidated Copper Co.
Ruth, Nevada , .190. .
To.
Mr .^. General Manager
' brill Rig'No. I
Location. Name of Claim
Present depth of hole
Previous depth of hole
Feet of drilling this shaft
Hours drilling
Hours lost
Drill man"? name ■•
Helper's name
Drill Rig No. 2
Location. Name of Claim
Present depth of hole
Previous depth of hole
Feet of drilling this shaft
Hours drilling
Hours lost
Drill man's name
Helper's name .'
Above report is for time ending.
Remarks
Fig. 165. — Daily Record of Prospect Drilling.
US the form shown in Fig. i66. Mr. Humphrey has used this
form for a number of years to keep account of materials received
in carload lots.
The form records the number and initial of the car, time of
arrival and delivery and also when the car is released.
The material man keeps this record and obtains from the railroad
agent the time of arrival. This form is ruled up in a small
'Engineering-Contracting, Nov. 20, 1907.
MISCELLANEOUS COST REPORT BLANKS.
285
CEMENT.
Note
11 dm
Car No.
Init.
Arrived
Delivered
Released
45913
69149
NYC
9.5 11 am
" 3 pm
9-7 2 pm
9-8 11 am
9-8 9am
9-13 10 am
— 1
Fig. 166. — Record of Freight Cars.
i
United States Depart.ment of Agriculture,
office of public roads.
Daily report of work on Object-Lesson road at Date:
Weather* Length of working day: hours. Signature:
Force Employed.
! Work Dt)ne.
Total
in
hours
or
days.
Pay
per
hour
or
day.
Total.
i Earth excava- 1
1 tion ...cu. yds.
; Subgrade
j shaped .sq. yds .
First course i
1 placed ; . . .sq. yds .
1 Second course 1
1 placed I . . .sq. yds .
I Surface course |
} placed i...sq:yds.
iRoad surface \
j completed. . . i . . .sq.. yds .
Material | .
Sta.. to Sta. .
Sta.. to Sta. .
Sta . . to Sta . .
Sta. .to Sta. .
Sta.. to Sta..
Sta.. to Sta. .
Foremen
Subforemen on
Teams .
Teams
Engine and
engineer. . .
1
Hauling [To crusher
surfacing \
Materials Used. Paid for by Unit
Measure.
Ixiading surfacinig.
matfrial at
Quantity,
Price.
Total.
Spreading surfacing
material
Steam or horse roller.
Sprinkler . ...
1 Surfacing ma-
1 terial '..
.masonry
Fuel for
crusher
Water boy
Fuel for
roller ....
W^ntrhman
Oil, waste, re-
pairs
Drain p i p e,.
1 Cement
. . .
1
. ■
1
Total
Total
R pmarlc; • J...
Fig. 167. — Daily Report, Road Construction.
(Engineering-Contracting, Nov. 13, 1907.)
286
COST KEEPING.
memorandum book, and on the adjoining page is kept a record of
the material received in each car and the amount, such as 15 tons
stone, or sand, 12 M. ft. of lumber and other materials.
Mr. Humphrey writes that this record shows at a glance
what cars are on demurrage or those about to go on demurrage,
thus showing the material man the cars to be unloaded first,
when there is more than one car waiting to be unloaded. Bills
STATE OF NEW YORK
Separtnicnt of State engineer an5 Surveijor— Improvement of public Wffibwa^a
CoHStruciion Report for the _ ..Rnnd^ No. fnr vri't ridimr
PROGRESS REPORT
Rough grading completed Tta. tif?*-', . Lin. ft. . Totnlto date, Sta. toSts.
Bottom course laid •• " " . " " , " " " •• "
No. of days roller worked No. cf .'.tv-,? rriisher ruu
No. of days sprinkler worked LABOR REPORT No. of days traction engine u.scl
S.
M.
T.
W.
T.
F
S.
TCTA
RATE
AMOUNT
r DIVISION OF UBOR EXPENSE
Foremen
Iti:m
Enginemen
DriUmen
rxcavation (or embankment)
MrsoDS
Cnrpenters
Onarrviiip; and crushinc: stone
Laborers
Teams
Carts
C-Tj.T'.le
1
1
I Ceuer.U,>e.cs
Tuial IaI.or expoos. for week
1
MATERIALS REPORT
' QUANIiTV
itYh-
n'.uf.cE
A«jUNT
HAUU0V.'0'S<
RLf'ARKS
Ca vds.
Bottom coursa sioco delivered at
Cu yds.
Top course stone delivered at
Cu yds.
Screenings delivered at
C.'mcut delivered at
Ft. b. m.
Lumber delivered at
l;u ft.
Vitri.led Pipe (Diam. in.) delivered at
Pounds
Steel at
Cu yds.
Sand for concrete at
C^. yds.
•■ ■■ filler at
.. Tons
Coal
Total materials ej;peuse for wee
EQUIPMENT REPO.-^T ENGINEERING FORCE ACCOUNT
^^^
remTrks
NIY.E
"?
V.
T
;;-
F
s
■-CTusl.c-rs
Steam rollers
Traction engines
Sprinklers
Carts or wagons
Steam druls
Scrapers
In charge
.ri D..CCT,0.. O- .<..... ..Dt
Address
Fig. 168. — Engineer's Weekly Report, Road Construction.
MISCELLANEOUS COST REPORT BLANKS.
287
for materials can also be checked up from this record, and freight
bills paid only for cars that have been received.
Being in book form, previous day records can be quickly
looked up, and the records of cars received for each contract can
be kept in one book and readily filed when the job is completed.
We might add that in addition to the information kept by
Mr. Humphrey, a few columns might be added to show cost of
unloading cars and hauling material. One of the authors used a
similar form some years ago. Besides showing the record as
Coiinry
„_|
LABOR ACCOUNT J MATERIALS ACCOUNT
T.mc
Rank
Kate
Amt. O-sn.
Item
Rate
Amt.
Item
Value
_
SL-.M.MARV 1
Labor expense
.Materials expense
Depreciation of plant
Total
lOTAL
Interest on investinent
Description 0: Work an.i Cond:!:or.;-
A'Jministrative expense, etc.
Total
Vo of Uni's
Observer
1
Fig. 163. — Special Cost Report, Roadwork.
given here, he had a column for foreman, if one was in charge
of unloading, a column for the men, one for the teams, and one
to show the approximate length of haul.
This record besides giving a cost of the work done, al-
lowed the contractor to know if the work was done with dispatch
and prevented the men from idling away their time, as they are
likely to do when a few men are sent off by themselves to do
such work. In a column for remarks notation was made if any
material or goods were received in bad condition.
Cost Keeping Blanks for New York State Road Work. — In
the road work done by the state of New York, each engineer in
charge of a road contract is provided with a weekly report blank.
288 COST KEEPING.
shown by Fig. i68, which he is required to fill out from careful
notes taken throughout the week. These reports are the basis for
the progress charts showing the rate of progress on each con-
tract. They also furnish the necessary information for the cost
data department. Special cost blanks like the one shown by
Fig. 169 are also furnished. These reports are used in cases
where exceptional opportunity offers to obtain the cost of any
item of work.
The inspectors on the work keep an accurate account of the
number of men employed and materials furnished, and report
them daily to the engineer in charge. On the last of each month
estimates are made out and sent to the division engineer, by the
engineer in charge of the work, for the amount of work done dur-
ing the month. These estimates are checked and signed by the
division engineer and forwarded to the state engineer. They are
again checked and compared with the original contract on file in
the state engineer's ofiice, and if found to be correct, the con-
tractor is paid 90 per cent of the said estimate.
Discussion of Cost Keeping: Smelting Plant, Railroad,
and U. S. Reclamation Service — Construction. — We reprint
herewith some discussions of a paper on cost keeping by Mr.
Myron S. Falk and published in Transactions Am. Soc. C. E.
Vol. LXIV, p. 401. We would call particular attention to the
last paragraph of Mr. Hammatt's discussion. Note also his
distinction between fixed and movable plant. In his work a
good deal of plant may be classed as fixed ; while in ordinary
contract work most of the plant is movable.
W. C. Hammatt, Assoc. M. Am. Soc. C. E. (by letter). —
When in charge of various pieces of construction, the writer has
always endeavored to keep close and accurate costs, in order to
check, not only the unit costs of different classes by previous work
of the same class, but also to present to the company, at the end
of the work, an accurate and minutely itemized valuation of the
work done, for inventory and insurance purposes. He has used
practically the same system in his work as Superintendent of
Construction for the Mountain Copper Company, at Martinez,
the American Smelting and Refining Company, at Chihuahua,
Mexico, and the Mammoth Copper Mining Company, at Kennett,
CaL; therefore, only one of these cases, for example, the con-
struction at Chihuahua, will be described.
MISCELLANEOUS COST REPORT BLANKS. 289
The first step of the system involved giving a segregation
number to each piece of work. This minimized the clerical work,
and also gave convenient reference to ledger accounts. In this
system of segregation whole numbers are used for the main divis-
ions of work and decimals of various length for the sub-segre-
gations under these divisions. This provided for a combination of
all the decimals of a certain degree when segregations of lesser
refinement were necessary for certain purposes. For example:
Construction Schedule.
General Expense:
01 Superintendence.
02 Surveying and drafting.
03 Office expenses.
04 Proportion, main office.
05 Temporary tracks.
06 Tools, push cars, concrete mixer.
07 Real estate.
08 Warehouse stock.
09 Warehouse expense.
Blast Furnaces: (These sub-headings apply to all
10 Building. following headings.)
11 Furnace No. 4, b.T'itle pipe, 0.1 Grading.
settler, etc. 0.2 Forms.
12 Changes in present furnaces. 0.3 Concrete.
13 Slag and matte equipment. 0.4 Superstructure.
14 Furnace No. 5, bustle pipe, 0.5 Falsework.
settler, etc. 0.6 Plumbing.
15 0.7 Wiring.
16 0.8 Painting.
17
18 Connecting blast pipe.
19 Blast pipe in smelter.
Converter Plant:
20 Building (including crane).
21 Converter No. 1 (including stand and tilting system).
22 Converter No. 2 (including stand and tilting system).
23 Downtakes.
24 Flue.
25 Charge system.
26 Copper disposal.
27 Slag disposal.
28 Blast pipe.
29 Hydraulic system.
Relin'ing Svstem:
30 Building.
31 Relining pit (including tamper and crane).
32 Clay mHls.
33 Clay and quartz bins. '
34 Track and trestle to same.
35 Tunnel.
36 Drving stands.
37 . . .'
38
39
290 COST KEEPING.
Charging System:
40 Tunnel.
41 Trestle.
42 Trackwork.
43 Equipment, charge cars.
44
45
46
47
48
49
Flue System:
50 Dust chamber, steel work (including hoppers).
51
52
53
54 Tracks.
55 New stack.
56 Equipment, cars, etc.
57
58
59
Power Plant and Blast Mains:
60 North addition (building).
61 South addition (building).
62 Receiver.
63 Changes in present blowers and connections.
64 Blower No. 4 and connections and motor.
65 Blower No. 5 and connections and motor.
66 Blowing engine.
67 Blower No. 6, connection and motor.
68 Blower No. 7, connection and motor.
69 Generating set No. 2.
70 Switch-board.
71
72
73
74
75
Sampling System:
76 Temporary sampling room.
77
78
79
Track System: ^^ Grading.
80 Standard gauge changes. 0.2 Track-laying.
81 New standard gauge yard. 0.3 Ballasting.
82 Slag tracks. 0.4 Switching.
83 Lime track.
84 Track scales.
85
86
87
88
89
MISCELLANEOUS COST REPORT BLANKS.
291
Shops:
90 Machine-shop building and blacksmith shop.
91 Machine-shop plant.
92 Steel shop building.
93 Compressor-motor and building.
94 Boiler-shop and round-house building.
95 Boiler-shop and round-house plant.
96 Carpenter shop building.
97 Carpenter shop plant.
98 Electrical shop building.
99
Bins and Trestles:
100 Main receiving bins.
101 Trestle approach to same.
102
103
104
105
106
107
108
109
Miscellaneous:
110 High-pressure pipe line.
111 Cement sheds.
112 Greek bunk house.
113 Drain tunnel.
114 Smelter stable.
115
116
117
118
119
Standard Gauge Equipment:
120 Oil tank.
121 Locomotives.
122 Wrecking crane.
123 Cars.
124
125
126
In regard to this list, it may be stated that it is faulty in its
arrangement, due to the full plans for construction not being
complete at the time the work was started. The writer believes
in a more complete segregation of fixed and movable plant, for
insurance and appraisal purposes, as a machine can be moved to
a new site, while its foundation can not, and the superstructure
of a building is subject to destruction and damage by fire, while
its foundation is not.
292
COST KEEPING.
In the matter of construction reports : The forms of two re-
ports used for cost keeping from day to day, are given in Figs.
170 and 171. That shown by Fig. 170 was made out daily by the
foreman for each kind of work done under his supervision, a
separate report being made out for each segregation. At the
end of the week the form shown by Fig. 171 was made out by
the cost clerk from the data on Fig. 170, and the measurement
AM
D
s
D
ERICAN SM£L1
CHlHUA
aily report of la
for_.
egregation_
'ING & REFINING CO.
HUA PLANT
3or on
ate_ _ _ ,
NO.
EMPLOYEES
NO.HRS.
RATE
AMOUNT
Foreman
CarpeuUrs
«.
Helpere
Mechanics
"
'•
HcIpeiB
Stone Masons
1
Brick «
1
Helpers
Eugineers
Firemen
Plumbers
Helpers
1 Llectricians
Laborers
«
1
Water bojs
1
f
FOREMAN
AM
C
S
E
ERICAN SMELTING & REFINING CO.
CHIHUAHUA PLANT
on
Bgregation
DATE
ACCOUNT
UNITS
RATE
AMOUNT
Labor
do
do
do
1
do
do
1
do
Briclc
Stone
Sand
Lime
Cement
Lumber
1 1
'
1
1
'
i j
1 ' '
i 1
Cost per unit | | |
Slan Jard size, 7 by 3K in- Btandard size. 7 by 3J^ in
Fig. 170. — Foreman's Daily Report. Fig. 171. — Cost Clerk's Weekly Report.
or estimate of each piece of work performed. The form shown
by Fig. 170 was also used by the timekeeper as a check on his
time, as the total number of man-hours or man-days should agree
in both cases, and also the total in dollars and cents for the pay
period.
As there is likely to be inaccuracy in progress measurements
which are taken daily, or even weekly, it is well to combine the
MISCELLANEOUS COST REPORT BLANKS. 293
reports of several weeks. These inaccuracies will then disap-
pear, and a truer calculation of unit cost may be made.
This system had to be varied for the different conditions
under which the construction work was conducted, for example,
in Mexico, where the foremen were mostly illiterate, special men
were employed for the cost keeping, and the forms differed
slightly from those used in places and on classes of work where
men of better mental capacity were employed.
Bills for materials of construction were distributed by the
superintendent or cost clerk at the time of checking to the ac-
counts where they belonged. When bills could not be charged to
their regular jobs, on account of the actual quantity of material
going to each job being unknown, the total was charged to ware-
house, and the different jobs debited and warehouse credited as
die material was issued.
It may be added that the engineer generally works under
difficulties in keeping accurate cost records, as the general idea
among American employers is that such data are useless expense,
and they will not allow the necessary clerical force to make them
accurate and useful. The sentiment among most of them was
expressed in the late ]\Ir. T. S. Austin's remark to the writer that
whether the brickwork costs $12 or $30 per 1,000, the work would
go on until it was completed or the company ''went broke."
Emile Low, M. Am. Soc. C. E. (by letter). — On construc-
tion work it is always interesting for the engineer-in-charge to
know, at least approximately, what the work is costing the con-
tractor. For want of absolute knowledge of the cost of some
items, it may be difficult to ascertain the total cost, but even a
knowledge of the cost of some of the items, as before stated, is
of some satisfaction.
It may be stated with some assurance that, during construc-
tion, nearly every railroad company keeps some kind of a force
account, which is rendered to the chief engineer, generally weekly,
by his subordinates.
Some years ago, while the writer was in charge of some
heavy railroad construction in Southwestern Virginia, he orig-
inated and put into effect a system of cost keeping, which
showed monthly the cost to the contractor of various classes of
work, the statements of which were submitted with the month-
ly estimates.
294
COST KEEPING.
The system was extremely simple, and consisted essentially
of three blank forms which constituted the basis for keeping the
records.
On the railroad in question, each residency consisted of from
seven to ten i-mile sections, thus each residency ranged from
7 to lo miles in length. The contractor's forces were counted
daily by a timekeeper employed by the railroad company, which
work comprised his whole duty.
NORFOLK & WESTERN R.R
CO.
_ DIVISION
1
DAILY STATEMENT OF. FORCE EMPLOYED BY
DESIGNATION OF LABOR AND MATEPJALS: ( (
RACTORS
DATE
I
2
3
1
5
ti
7
8
10
ON
ATION
SECTibN Na
FOREMAN '
OESICNATION OF LABOR AND MATER'AL:
DATE
1
2
3
1
5
C
7
8
9
10
8
V
T
w
T
F
F
s
S
TOTAL
TOTAL
s
s
M
M
.
T
T
W
W
T
T
F-
F.
S
1
S
TOTAL
TOTAL
1
&■■
SUMMARY
M
DESIGNATION
or
LABOR
AND
MATERIAL
FO
R WEEK AND PARTIAL WEEK
-1
<
1
AMOUNT
T
END
no:
W
T
F
1
S
2
TOTAjJ
3
8
4
M '
5
T
6
~^{ J
W
7
T
8
F
»
S
,0
TOTAL
TOTAL
••
8tandu-d siz«, 7 b; 8H m..
Fig. 172.— Record of Labor and Materials, Railroad Construction.
A special timebook was prepared, a double page of which is
shown by Fig. 172.
From an inspection of the timebook it will be noted that it is
arranged to keep a separate record of each and every piece of
work, no matter what it may be. It is also arranged to show the
totals for each full week as well as for the partial week. Occas-
ionally, there is a month which includes four full weeks and parts
of two weeks, making space for six entries necessary.
MISCELLANEOUS COST REPORT BLANKS.
295
The usual practice is to send in the force accounts weekly to
headquarters, and the arrangement of the book facilitates this.
At the end of the month there is a summary from which the cost
of the work is obtained.
RE
SE
MC
RAILROAD CO..
n
SIDENCY NO.
COMPARATIVE 'STATEMENT
ESTIMATE vs. EXPENSES estimate no
CTIONS NOS. ^ _
OIVIfilON 1
CLASS OF
LABOR
RATE
SEC.
SEC.
SEC.
SEC.
NO.
AMOUNT
NO.
AMOUNT
NO.
. AMOUNT
MO.
AMOUNT
I
E»borfcrg
Teams
!
1
Total Ubor
1
EgUmate
j
Dinercnce
i 1
1
i
i
s
Furcu^n
1
UboArs
1 .
!
Teams
1
i
1 I
1
■
Total Ubor
! 1
!
'
Differetio*
.,
1
1
1
a
Foremen
1 1
i
Uborcrs
i
Team. ,
1
Blackamithg
1
Carpenten
1
j
1
1
Total Ubor
1
Superintendence
ExploBirea
Total Expense
1 "
Ettimate
1
Difference
1
1
Foremen
1
Stone Cutters
1
[
Masons
1
[
Uborers
1
1
1 1
Teams
t
! 1
{
i i
1
1
i 1
1
1 1
Total Ubor
!
1
1
1
1
Estimate
1
DilTerence -
1
Staadard size, 8}i by I0}i in.
Fig. 173. — Monthly Summary, Railroad Construction.
Of course, owing to the method used, the cost obtained is
not absolute, as the force employed during the morning and after-
noon may vary in numbers, the timekeeper passing over the work
296
COST KEEPING.
only 6nce a day. Where absolute accuracy is required, more time-
keepers would have to be employed.
As there are no printed headings, the spaces may be filled in
as the nature of the work requires. Space is provided for ten
1
1
OAD COMPANY,
DIVISION ENGINEER
:ment
NSES CONTRACTOR
B
if
4
-
—
lii
'3
5
i ^^
0
•
COMPARATIVE
ESTIMATE VS
ECS. NOS. TO
iri
-
Q.
5 r
CO H
§
1
i
I
-
feg
1
2
i
1
FORM No.C.E .
CONSTRUCTION DEPARTMENT.
RAILROAD COMPANY.
.DIVISION,
COMPARATIVE STATEMENT.
ESTIMATE vs. EXPENSES.
RES. NOS. TO iwri^
8ECS. NOS. f
ESTIMATE NO. _ . .
TO INCL.
a
100
1
1
SUMMARY: contractor
COLLARS
CTS.
Labor
X
!
Explosives _
Stone. Sand, Cement
Timbei, Iron, Bolts
s
9
Gross Estimate
«
Apporent,* . .
*GAINORLOSS
1
._. (. .J
Apparent
EXTRA WORK
Amount plus 1 5 Per Cent
........
15 Per Cent
Certified By
engineer"
DIVISION
Fig. 174. — Monthly Summary of Fig. 175. — Monthly Summary of Actual
Actual and Estimated
Costs, by Sections.
Cost and Estimated Costs, Entire
Contract.
different designations of labor and material^ and in cases where
there are more items, other pages can be used. It will be seen
that the timebook is very flexible, and can be adapted to any con-
tingency.
MISCELLANEOUS COST REPORT BLANKS. 297
At the end of the month all work is classified, the form, Fig.
173, being used. The sample sheet shows columns for clearing,
grubbing, grading, and masonry. This column is left blank, and
the various classes of work are written in, using as many sheets
as necessary.
Before the final classification, by sections, the location of each
individual piece of work is entered in the column having the
printed heading, "Sec." On the grading there may be as many
as ten or more forces at work on a mile section ; several culverts,
bridge abutments, and piers may also be building.
The blank form. Fig. 173, may be used in making a compila-
tion showing the cost for separate localities, or the totals for any
one section may be entered, these totals being obtained by the
addition of the various separate items.
Fig. 174 is a blank form showing the summary of all the
work on a contract.
The main idea underlying the whole scheme is to make a
monthly comparison with the engineer's estimate.
Referring to the timebook, Fig. 172, there is on a page the
cost to the contractor of a particular piece of work, during the
month, say, a bridge abutment. An estimate of quantities and
cost has been made by the engineer in charge of this particular
work.
The details of the cost to the contractor are transferred to
the blank form. Fig. 173, the amounts being shown under the
heading marked *'Sec.," the "estimate" placed under the total, and
the difference obtained, which will be more or less as the case
may be. These statements then show in detail the expense and
estimate of each particular piece of work.
Then a summary is made of each and ever)* kind of work
by sections (i mile), and also a summary of the various esti-
mates. These summaries then show, mile by mile, the status of
the various kinds of work.
The engineer's estimate always shows the total co^t of a sec-
tion, and in order to make a proper comparison of all expense,
another blank form is needed, which shows a summarj^ of all the
labor, superintendence, explosives, stone, sand, cement, timber,
iron, bolts, etc., this being the total cost of all the work in a sec-
tion.
298 COST KEEPING.
These totals, shown by Fig. 175, may be readily obtained
by using the form shown by Fig. 174, for the purpose of tabula-
tion, as the main items are all placed in separate columns, and
can be easily added. In some quarters objection is made to keep-
ing an accurate account of the forces employed by the contractor
and the tabulated cost, the main reason assigned being that the
engineer's estimate is influenced thereby to some extent. This
need not be, as the cost to the contractor is not generally known
until some time after the estimate is made out. In most public
works nowadays there is no classification of excavation, so there
are no grounds whatever for manipulation, although there might
be under the classification method of dividing excavation into
earth, hardpan, and loose and solid rock.
Again, the contractor's cost may be tabulated wholly in the
division engineer's office, or even in the office of the chief en-
gineer, he being furnished with duplicate copies of the timebooks,
which, as before stated, form the basis of the whole system
described.
The writer is a firm believer in keeping costs of contractor's
operations, for the very important reason (and almost the only
one), that it afifords some tangible evidence of fixing suitable
unit prices on future work, instead of using that very undesirable
makeshift, guessing at them.
F. H. Newell, M. Am. Soc. C. E. (by letter).— The follow-
ing comments, prepared by Mr. V. C. Croissant, are offered with
the hope that they may be of value.
A careful reading of Mr. Falk's paper leads to the conclusion
that the system described is for use on work which is highly cen-
tralized. The contracts are evidently for compact pieces of work
in a city. The opening paragraphs state very clearly the real
value of cost-keeping data in the great majority of construction
operations, and are especially pertinent to those for which this
system is applicable. The method described would result in ac-
curate data covering prime costs of any class of work in which
labor was the principal cost element.
It should be noted that there are two sources of error in cost
accounting which seem to be almost impossible of complete elim-
ination. With the presence of possible errors due to either or
both of these causes, the results are practically valueless to any
contractor except (as stated by Mr. Falk) the person actually
MISCELLANEOUS COST REPORT BLANKS. 299
preparing the data. Even he may be so deceived by his own
calculations as to find the bankruptcy courts eventually his only
relief. These sources of error are:
1. The substitution of estimates for certainties, in the case of
the engineer or proprietor who is so thoroughly impressed with the
value of direct and prompt information that he uses assumptions
(in many cases purely guesses) for actual mathematical facts.
Such a man gathers daily all the data possible, and, because of a
lack of system or of a comprehensive plan, fails to consider many
items, such as unpaid purchases, unpaid labor, depreciation on
plant, interest on investment, the value of his own time, and sup-
plies consumed which are not measureable in the completed units
of work, but which, nevertheless, are fundamental and positive
cost elements. His main ambition is to "know from day to day
how things are going." To do this, he arrives at theoretical re-
sults by a series of allowances, the component elements of which
are not certainly known. He may guess at them, or he may omit
them entirely. His hypothesis may be satisfactory w^here the
work to be done is small, and highly centralized, and w^hen the
engineer making the estimates is of large experience and excel-
lent judgment.
2, The delay for accuracy which occurs with the book-
keeper or cost-keeper who is professionally proud of his work,
and so short-sighted, as to make absolute accuracy his main con-
cern. Such a man insists on the results being unassailable from
any and every angle ; the figures must ''balance," or "square
into" everything that bears on the accounting of the firm. This
makes for accuracy — eventually — but the results are largely his-
torical, and, after being neatly typewritten and "tied into" all
related statements, are allowed to see the light of day long after
the evils which they might have corrected are forgotten by the
"man on the job." They are simply the autopsy of a dead trans-
action, not a diagnosis of the progress of a vital case.
The plan presented by Mr. Falk is one which requires a
single book, namely, the cashbook. It would appear that all lia-
bilities must be paid immediately ; and that everything purchased
in the way of supplies must go into the work immediately. If
such is not the case, then future liabilities will not reach the cost
accounts until the supplies represented are paid for. If supplies
300 COST KEEPING.
are, purchased against a future need, they will be charged in the
month paid rather than in the month used.
A cashbook, of course, cannot be used to record estimated
depreciation on equipment used from month to month. If the
work is done largely by expensive equipment, this important ele-
ment of cost, depreciation, is overlooked. Interest upon invest-
ment would be entered from time to time if money was borrowed
and interest paid at the bank. If the capital is actually paid in
by the proprietors, and, consequently, no regular interest payment
is made, then the cashbook would not record the legitimate earn-
ing on this capital to which it would be entitled. The old account-
ing question of whether bookkeeping should deal with cash re-
ceipts and disbursements, or whether it should deal with the ques-
tion of values received and expended, whether paid for or not,
is the one which really comes to the front. It was settled long
ago in favor of the latter method.
For a small business, the cashbook may be the only record
necessary, but for operations which are extensive, it is, perhaps,
the smallest part of the necessary bookkeeping records. The
same rule may be laid down to decide whether or not cost-keep-
ing shall become a part of bookkeeping. In small operations, it
is quite possible to arrive at very accurate costs by a system of
card records entirely independent of bookkeeping, but, for large
works, the elements of cost are so numerous that a well-defined
automatic system, governed or controlled by analytical account-
ing methods, must be adopted in order to insure complete records.
In the United States Reclamation Service a system has been
adopted in which an attempt has been made to harmonize the
views and serve the purpose of both the engineer and the account-
ant. In all Government work it is necessary, in addition to having
the available results for the immediate use of engineers, foremen,
etc., to make a permanent record of costs, since that work is sub-
ject to investigation by commissions, and by the public; and the
expense of construction must be brought within a specific appro-
priation or allotment of funds, which corresponds to a commercial
contractor's bid price for a given undertaking.
The system adopted by the Reclamation Service has been
devised in order to place in the hands of the man locally concerned
a complete record, which is available for his inspection from day
to day, and shows the prime cost of all work. This prime cost
MISCELLANEOUS COST REPORT BLANKS. 30I
takes up the charges for all labor, material, and supplies used;
these records are entered daily, and, by the use of the adding ma-
chine, totals under any classification of expense, or for all classifi-
cations under any feature, can be known in a few hours. After
the local cost-keepers have finished this tabulation the results go
to the bookkeepers, who add the top extrinsic costs, such as ad-
ministration, depreciation, and all the other expenses, which are
unknown to the timekeepers and storehouse clerks. These are
finally assembled in the project offices, and monthly statements
for each feature are transmitted to the general office in Washing-
ton. When any large, or important feature is finally completed,
the project engineer prepares from these local records a cost
report showing the cost by units of work done, which is analyzed
into all the elements of labor, material, supplies, power, deprecia-
tion, superintendence, general expense, etc.
By the method used in the Reclamation Service, the princi-
pal machinery for assembling costs is :
I. — An Account Numher Book. — Each feature or job of work
is assigned a set of numbers, as many being reserved as will be
necessary to give each classification of expense a number. The
following is an example :
Dam for reservoir.
260 Superintendentence and engineering.
261 Labor, foremen.
262 Labor, masons.
263 Labor, cranemen.
264 Labor, teamsters.
265 Labor, timekeepers and clerical.
266 Labor, laborers.
267 Labor, animals owned and hired.
268 Labor, blacksmiths.
269 Labor, drillermen and machinists.
270 Supplies, cement.
271 Supplies, powder, dynamite, fuse, etc.
272 Supplies, drill steel.
273 Supplies, lumber.
274 Supplies, power.
275 Supplies, miscellaneous supplies.
276 Supplies, labor and repairs.
277 Employers' liability.
278 Depreciation on equipment.
279 General expenses.
2. — Timebooks. — These books are ruled so that the time of
each employee may be shown for each class of work performed.
When the timekeeper takes time, he makes the proper notation,
302
COST KEEPING.
7-595
SHEETNO TIME BOOK 19.
(Month) (Feature) 0-1191
a
^
CO
gl
CJ
o
o>
CO
1^
o
tn
'*•
CO
eg
::
—
o
5>
00
r-
lO
1 ^
■*
CO
CVJ
^
o z
■
1
1-
<
i
g
i
3
1
cm
§
5
_
Ul
UJ
-J
°5
Time and rate of pay correct-
6-1191 (Engineer)
i
o 1
i i
CO
^
§1
s
C\J
s
ti
^
t^
o
,,
^
<D
s
S
^
MISCELLANEOUS COST REPORT BLANKS.
303
1
DEPARTMENT OF THE INTERIOR REQUISITION
U. S. RECLAMATION SERVICE
No
PROJECT
m
To STOREHOUSE CLERK:
feature:
ACCOUNT
NO.
QUANTITY
. ARTICLES
UNIT
PRICE
TOTAL
WANTED
FURNISHED
Origina
I {on wh
te paper) goes to cost keeper
for entry in classification book
Duplici
,te {onpinh) remains with storehouse
clerk for; his protection
Triplic
lie (on yelloic) is retui-ned to foreman
as an
advice of cost of goods furnished
....
Deliver
to __ _ - .
For for
wardint
jby ...
Wagon BUI of
Ladinsr^
ro
(Sicned)_
Received the a
rticles at
(Siened)
wve listed as furnished
Standard size 5H by 7X io.
Fig. 177. — Requisition Blank, U. S. Reclamation Service.
304 COST KEEPING.
indicating the hours worked and the class of work. Fig. 176 is
an illustration of a timebook adapted for this purpose.
3. — Requisitions. — All supplies, materials, etc., are issued
from storehouses at cost plus freight and a percentage addition
to cover handling and storehouse expense. For this purpose a
requisition blank, Fig. 177, is used. Each foreman is supplied
with a list of account numbers which are allotted to the features
of work in his immediate charge. When he makes up a requisi-
tion, he indicates, opposite each article ordered, the classification
to be charged, by inserting the account number assigned to that
classification. The storekeeper enters on the requisition the unit
price and total value of supplies issued.
4. — General Classification Book. — This book. Fig. 178, is
used to assemble the items of expense under each classification.
Each folio is ruled with ten columns, and the columns are num-
bered from o to 9. The first folio is not numbered, and the col-
umns o to 9 will represent the classification indicated ; the second
folio is numbered i. Reading the column numbers as the units
with the folio number as the tens, the columns on folio No. i will
assemble the charges against classifications Nos. 10 to 19. Any
number of account numbers can be added by inserting additional
folios, as this is a loose-leaf book. There are thirty-one horizon-
tal lines — one for each day of the month — and a few additional
for special entries at the end of the month, as depreciation, in-
terest, etc.
The amount of charges appearing on requisition is entered
daily in the respective columns, and the earnings of employees,
as shown by timebooks, may be thus noted. The foreman or
engineer wishing to know the cost of work on any particular fea-
ture at any time has only to ask the cost-keeper to add up the
columns representing the classifications assigned to that feature,
and he will have the total cost for labor and supplies expended to
that date.
At the end of the month these sheets are removed from the
binder and sent to the bookkeepers, who add the top costs and
post the total for the month to the cost ledger which contains
all charges for previous months, thus making a final completed
record.
With the detailed analysis, as accumulated in this manner, the
engineer can make a complete cost statement in minute detail or,
MISCELLANEOUS COST REPORT BLANKS.
305
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if he prefers, in general terms, by combining several analogous
classifications.
There are many other accounting phases which the writer
has not mentioned herein, as the purpose is to treat of a method
of cost keeping. Any accountant can fit the general plan above
described into a well-organized bookkeeping system.
George Hill, M. Am. Soc. C. E. (by letter). — Every member
of the society who presents a workable solution of a problem,
and especially one of such importance, is entitled to the thanks
of the members for so doing, and therefore the writer feels that
on so important a matter as cost keeping Messrs. Falk, Hammatt,
and Low have done well to contribute of their experience.
The attempt has frequently been made to solve the problem
in some conventional or semi-conventional manner, usually with-
out success, for the reasons that there existed :
a. — A lack of appreciation of the requirement for sim-
plicity ;
b. — A lack of appreciation of the fact that the informa-
tion required is a combination of figures and the
combinations are constantly changing;
c. — The general belief that cost keeping is something
different from bookkeeping, instead of being intelli-
gent bookkeeping.
If the accounts of any piece of work can be kept so as to
meet, on the one hand, all the requirements of bookkeeping, and,
on the other hand, all the requirements of cost keeping, the prob-
lem is in the way of being solved.
The real and only purpose of bookkeeping is to show the re-
ceipt and disbursal of money in an accurate manner. If this is
performed so that, with a minimum of clerical work, clerical and
arithmetical errors can be readily detected and eliminated, it is
good bookkeeping.
When the next step is taken, and the memoranda of disbursal
show for what the disbursal was made, this is beginning cost
keeping.
If this is done in sufficient detail and in such a manner that
the summations of two or more groups can be readily combined,
the problem of cost keeping is solved.
If vouchers, checks, and bills are arranged so that they can
MISCELLANEOUS COST REPORT BLANKS. 307
be readily examined and compared with the entries, this provides
for an accurate and inexpensive audit, and meets completely all
the proper requirements of bookkeeping, cost keeping and audit-
ing. The writer would emphasize the word "proper" ; there are
in use systems which are very complete but are so burdensome
that the facts cannot be recorded and transcribed until long after
their usefulness has vanished, and they are so full of detail as
to blind the mind completely to their true significance. Knowl-
edge of costs should be a weekly matter, and action should fol-
low promptly.
It is a good thing to know that concrete 5 in. thick, placed
in forms, cost on a certain job an average of 20 cents per sq. ft.,
but it is more important to know that Brow'n's gang laid it for
18 cents, while, with Smith's gang, it cost 22 cents, under the
same circumstances.
While it is possible to predetermine the general lines along
which costs will be required, two-thirds of the questions asked
in regard to costs will call for summations of items other than
those originally contemplated, and the same question w^ill rarely
be asked twice ; consequently, the problem which the writer has
attempted to solve is not a simple one. He has been engaged for
many years in executing work on a fixed profit basis, and has had
experience with the accounting systems of a wide range of clients,
and, as a consequence thereof, has been compelled to devise a
system of his own. Practical experience with this system has
demonstrated its applicability over a wide range of subjects in a
satisfactory manner. It is hoped that a description of it will be
of interest to the society.
Although the system presents a method of keeping the exact
cost of a piece of work, and is therefore in the nature of book-
keeping, it is not bookkeeping in the conventional sense, but an
orderly arrangement of memoranda which are kept so that any
cost question which may be asked during the progress of the
work, either of a detail or of the entire work, can be answered,
either immediately or in a few minutes. The memoranda are
kept so that, if there are a variety of jobs in the office, each one
is separate and distinct in its entirety; finally, they are kept so
that, as soon as a piece of work is completed, all memoranda in
regard to it are immediately filed away and prevented from in-
terfering with other work in the office.
308 COST KEEPING.
The writer will describe the system as applied to building
operations on a fixed profit basis, as in this way the principles in-
volved will be understood, and concrete examples may be more
easily obtained.
I. — Each piece of work is given a designating job number,
and the estimate of original cost is entered in a monthly statement
in a column headed ''Original Allowance." In making up the
estimate, the details of work, comprised under each account sub-
division or number, are worked out in full^ so that the cubic yards
of excavation, and the incidental expenses thereof, are clearly
stated.
In a column headed ''Structural Steel," the number of tons
of each of the various classes of steel, cast iron and other work,
the price for the fabricated material, and the erection costs are
stated, and so on down the list.
The sum of the statements in the column headed "Original
Allowance" gives the total cost of the work, and these items are
carried along in the monthly statements.
Any changes involving cost alteration are entered in a col-
umn headed "Additions." These additions appear in this column
only for the month to which they refer, and in the following
month are transferred to the "Original Allowance" column, leav-
ing the "Additions" column free for the current month's changes.
The column headed "Payments" contains the summary of
the disbursements under the various accounts to the date of the
statement, and shows the total cost of the work to date. The sum
of the payments plus the balance on hand in the bank (which is
stated on blank lines at the bottom of the sheet) must equal the
sum of money advanced or set aside for the conduct of the work.
All obligations incurred, either in the nature of sub-contracts,
contracts for materials, and the like, are entered under the head-
ing, "Contracts Made;" the column headed "To Complete" is
only used occasionally, usually as the work approaches comple-
tion, for the guidance of ofiicers or others who are not sufficiently
familiar with all the details of the work to be able to supply the
figures without assistance. It is rarely used more than three or
four times on a job, but by being inserted in the monthly state-
ment makes an additional form unnecessary.
2. — The time is kept in duplicate by using one or more time
sheets as may be necessary, and making a carbon copy. The
MISCELLAXEOUS COST REPORT BLAXKS.
309
sheets are made up in pads, kept in an enameled leather case, and
each week the originals are sent to the office.
The columns, ''Total Hours," and ''Amount," are usually
filled in by the superintendent and checked at the office.
The pay-roll for each account number, as given in the
monthly statement, is kept so that one man's name may occur
several times on the pay-roll. The only disadvantage connected
with this is that sometimes two pay envelopes are made out in
the same name, the sum of the two being the correct amount
earned.
In the writer's work, weekly pay-rolls amounting to $1,500
require two hours' time to check, draw the money, place it in the
envelopes, and prove the accuracy of the distribution.
3. — Materials in general are provided for either in connection
with sub-contracts or by agreement with supply houses. If de-
livery is to be made complete at one time, and the time is de-
termined, one of the orders is issued ; but if delivery is to be made
piecemeal, or at different times, two or more orders are issued,
and these are sub-divided so as to secure each delivery at the
time when it will be needed. The order is made out in quadrupli-
cate, the order blanks being made up in pads and in sets of four,
so that, by the use of carbons, one writing suffices for the four.
The first or white copy is to be retained by the party receiv-
ing the order, and on the back of this the conditions of the order
are printed.
The second, or pink copy, is a delivery receipt. It is sent
with the order when delivery is made, is signed by the job super-
intendent, and, when the bill is rendered, is attached to the bill
and affords a means of checking it.
The third, or blue copy, is sent to the job superintendent as
a notice to him that the order has been placed. As soon as the
order is delivered, he signs the blue copy and returns it to the
main office, where it is filed temporarily and is an evidence of a
debt which should be paid on the first of the following month.
The fourth, or yellow copy, is retained in the office for pur-
poses of comparison with the other copies and as an evidence of
an outstanding obligation.
This procedure is followed in all cases except for bricks,
sand, broken stone, cement, and loads of rubbish, in which cases
slips printed on stiff paper are issued, and are dated with an in-
310 ^ COST KEEPING.
delible pencil by the superintendent when issued. These sHps are
returned with the bill, and, after the bill is checked and audited,
are destroyed.
The blue and yellow order slips are kept in the same file, and
are usually arranged in groups, so as to be readily reached. When
the pink order slip comes with the bill, the blue and the yellow
copies which correspond are removed from the file and, after
comparison, are crossed off, then the three slips are placed in a
file for paid orders.
The order numbers are endorsed on the bill and, if necessary,
are grouped under the account numbers so that the bill is sep-
arated into its component accounts.
4. — Small sub-contracts are treated the same as orders.
5. — In reference to payments, each job executed is conducted
as an independent piece of work, the agreement with the owner
providing, that, from time to time, he shall furnish the funds
necessary to conduct the work. The funds are deposited m the
bank to a separate account. This is done because the only effec-
tive control that can be exerted on work is the control of the
purse strings ; that certifying to the owner that payments are due
is very far from being the equivalent of a payment, and, finally,
that where the builder's own capital is used for the conduct of
the work, a charge would necessarily have to be made for such
use, which would result in an increase in the cost.
The bank check used for this purpose is twice the width of
an ordinary check. It is filled out so that the charge against the
proper account number will appear on the face. The checks
are carboned when written, so that an exact copy remains in the
ofiice. The check when issued is folded longitudinally, Is en-
dorsed in the customary way, passes through the bank as an or-
dinary check, and, although several thousand have been used
with different banks, has met with no objection.
The check form is a typical pay-roll check. When a payment
is made, the check number is endorsed on the bill or voucher, and
the bill or voucher is filed in a Shipman file in numerical order.
6. — In keeping the records, the writer uses a 9 by i3]>2-in.
Shipman Common Sense Binder; heavy manilla sheets, with
canvas tags bearing the account numbers, are used to separate
the accounts, and regularly ruled ledger sheets are interposed be-
tween them for each account, as many sheets being used as are
MISCELLANEOUS COST REPORT BLANKS. 311
necessary. Additional sub-divisions are provided for recording
the checks issued, called the "Cash Account," and for binding in
the monthly statements. In small jobs, provision is made for
binding in all contracts, sub-contracts, and additional orders re-
ceived from the owner. On large jobs a separate binder is used.
The cash account sheets are regular ledger sheets, one-quar-
ter of the upper left side of the page being used for the entry of
money received. The remainder of the left side of the page is
used for entering the checks, with date, number, name of ac-
count, and amount. The right side of the page is used for keep-
ing a running balance. This serves two purposes, the balance on
hand is always immediately evident, and the sum of the checks
to date, obtained at the end of each month, must show a balance
equal to that obtained by the partial steps, thereby proving the
arithmetical operations. Each check is entered in detail in the
detailed accounts, the first page usually being devoted to labor,
and the succeeding pages to materials and small contracts. En-
tries are made in the detailed accounts showing obligations in-
curred, where contracts are made for specific amounts, and these
are entered on the left half of the page. Where checks are drawn
to pay bills, the entry on the left half refers to the bill, and the
payment is entered by date and check number.
The sum of all the entries on the right side of all the pages
must equal the total payments to date. These summations are
usually made lightly with a soft pencil at the foot of the page, and
are carried ahead for each account^ so that the last page of the
account shows the total amount paid thereon. The monthly sum-
maries of the larger divisions of each account are made in ink,
so that a simple subtraction or the addition of three or four sets
of figures will always give the month's business, for that particu-
lar item. The bank book is written up each month, and, as no
payments are made except by check, the bank balance should
correspond with the balance shown in the accounts, which,
through the bank, proves the accuracy of the total payments made,
and this gives an amount w'hich should be the total of all the
detailed accounts. Comparing month by month, as given in the
monthly statement, the progress of the work is evident.
The writer has made it a practice always to prepare his own
pay-roll checks, and to visit the work at least weekly. Writing
out the pay-roll checks serves to fix temporarily the cost of the
312 COST KEEPING.
preceding week's work in the mind, and if a man is experienced in
doing work, he can tell at once whether or not for that week's
work he has received proper value for the wages disbursed. In
the writer's experience, that is the best time to correct a foreman
or a superintendent, because there is then likely to be little dis-
pute as to the facts. This prevents the continuance of errors of
organization, and shows where the ax should fall.
Generally, order slips and folded checks are of the same size,
and all blanks are of conventional file size, so that any one of the
filing system cabinets may be used. The cost of the work may be
determined within a small fraction of i per cent at any time by
an examination of the file. Each file is independent for each job,
and can be taken away for study, or the entering can be inter-
rupted at any point without difficulty.
All receipts, cancelled checks, and paid bills are filed in a
similar Shipman's file, so that on the completion of a job the en-
tire records may be filed. The space required for a $250,000
building operation is about 9 by 14 by 12 in. By the use of the
forms in this particular way, duplicates are obtained of orders,
checks, pay-rolls, and monthly statements, carbons being an ex-
tremely important factor in saving time. On a $250,000 job the
average monthly cost for all entering, bookkeeping, checking of
pay-rolls, and the preparation of monthly statements was 16
hours at 35 cents, or $5.60.
As described in detail above, the system appears cumber-
some ; in practical working, it is simplicity itself, as is evident
by the time and cost of keeping it up.
Accounting and Cost Methods for Contractors.* — There
are two ideas extant regarding the keeping of records by con-
tractors. The one is put forth by a class of accountants who
are bookkeepers and nothing else. They regard any work done
by men who are not trained in bookkeeping to be an unwar-
ranted infringement on their rights, and claim no one should
attempt to make records of a financial transaction except a man
of experience in ordinary accounting methods. The other idea
regarding the keeping of accounts on contracting jobs is put
forth by men of practical experience, who hold that every man
on the job who Is in a responsible position and can write, should
♦Ernest McCulIough in Engineering- Contractingr, Sept. 1, 8, 15, 22, 1909.
MISCELLANEOUS COST REPORT BLANKS. 313
send in a daily record of his work, even if he does not know
how to keep books.
One thing exists in common between the warring factions,
and that is that forms are required. Of the two, the bookkeeper
gets out the most involved. The man without experience in
account-keeping gets out forms containing, as a rule, too much
detail, but his forms, at any rate, have the merit of being under-
standable by the average man. Unfortunately, in these days of
vertical files and card indexes and business men's magazines
and industrial literature generally^ a great many amateur form-
makers have been working. The preparation of a set of forms
to give a man all the information he requires for his business,
is not a matter of engaging a form-maker for a few days or
hours to turn out a system full fledged. Forms must be tried
out on work and changed many times before they finally get
down into shape. It is a mistake too often made that each
particular business must have forms differing from those used
in other lines of work. It is possible, to have a practical uni-
formity about such methods, so that a set of forms used in one
place can do in another, and forms prepared for one line of
work can be used in another. There may be some difference
in some of the details, but it should not go further.
The writer's habit has been to make forms on mimeograph
or hektograph and try them out, making changes frequently
until by the time a job was completed a form would be worked
out, and then when a similar job came up the form for it was
ready. Finally, after a number of years of experience in han-
dling work personally, and by means of foremen sent off to
distant parts, he worked up a system for small pieces of work
that has been very satisfactory in his ow^n case.
In the first place comes the cash book. This is very im-
portant. He has had young fellows who took courses in busi-
ness college, who actually did not know a simple method of keep-
ing track of money spent and money received and how to bal-
ance the book. No matter how many forms are devised, the
cash book cannot be dispensed with. The size of the page
matters little, but for the sake of uniformity and the filing away
of books, etc., he prefers a cash book having a page practically
6x9 ins. in size, ruled for single entry. Upon the left-hand
page enter all money received, and upon the right-hand page
314
COST KEEPING.
enter all money expended. Figure 179 shows the appearance
of a cash book used on one job, with the names changed. These
pages illustrated give the account for one week. It is presumed
that a report will be made out each pay day evening to the
home office, and the report for the week shown on the cash
book pages is given in Figure 180. The report is made on
a sheet of paper purchasable at any stationery store.
One book will do on almost any job of the ordinary size
that one man will be sent away to take care of. The habit of
MISCELLANEOUS COST REPORT BLANKS.
315
the writer is to buy a book containing about 180 pages. The
job has to be completed within a certain number of weeks. For
instance, some job we are now considering will take 30 weeks.
Reserve all the pages up to page 70 for cash accounts. The
cash received will occupy one page and the cash paid out will
occupy the facing page. Therefore, for each week there will
t
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Fig. 180. — Weekly Cash Report from Cash Book.
be two pages reserved, and a few can be added in case the job
overruns the time. Even if the cash items only take a few
lines, it is well to give the whole page to the week's items, as
it looks neater and allows of the making of entries afterwards
in case the books are gone over to get unit costs, etc. On the
job shown here there was supposed to be a cash balance in the
bank at all times of not less than $200, and a check for the
weekly payroll was sent on from headquarters in time to take
care of pay day, which was Saturday.
3i6
COST KEEPING.
Having reserved for the cash account a little over double the
number of pages it is estimated the job will last weeks, the
remaining pages are used for keeping track of bills received.
Each bill is copied in full the day it is received. Figure i8i
shows how a page looks. These bills should be copied in full
daily and mailed to the home office with the daily work report.
There should be no delay in doing this work. The experience
of the writer, and of every employer of men, has been that if
things like this are not attended to daily they will be neglected
and- at the final moment there will be a rush. A man who will
9^
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Fig. 181. — Page from Book Containing Copies of Bills.
not do this work daily should be discharged. There is no
excuse. A few minutes' work each day saves a great deal of
worry and bad work before the job is completed. The home
office always wants the original bills. Very many times a home
office does not see why the man on the job needs any copies of
bills at all. Invariably when a dispute arises the home office
appeals to the man on the job, and it is a fine thing for him
to have a record.
Instead of going to the trouble of copying these bills, it
is required by some firms that duplicate bills be obtained for all
purchases. There are some objections to this. Many times pur-
MISCELLANEOUS COST REPORT BLANKS. 317
chases are made tor cash, and to delay while the slow-moving
bookkeeper makes out a duplicate bill, might cost more dollars
in lost time than it is worth. Take the cash slip and go. A
great many firms, especially in the smaller towns, never make a
habit of giving duplicate bills, and to ask for them causes bother
and delay. Very often they are not given and then some part
of the account is lost. Duplicate bills are a source of great
annoyance nine times out of ten, and very often a first-class
foreman becomes poor in looking after his regular work be-
cause of the time consumed in looking after the accounts. The
duplicate bill idea is good if it were the habit of every business
house to make them out. In one town a small contractor was
told by one house that his business amounted to so little that
they did not care to keep it if they had to remember every time
to make out duplicate bills for every little purchase he made.
Duplicate bills are pasted in invoice books or put in letter
files, and when the inevitable inquiry comes from the bookkeeper
in the home office, the particular bill wanted is often missing.
It does happen sometimes that mail is lost or destroyed, and the
importance of having copies of all papers should not be over-
looked. The writer is very firmly impressed with the value of
a hand-made copy of every bill received. These bills should
be sent to the home office every night in order that there will
be no accumulation.
In the back of the book there should be a record of carload
freight received. It is usually easy to tell in advance about
how many carloads of material will be received. Counting one
line for each car record, count ofiF twice as many lines (for some-
times things turn out differently from what was expected), and
rule up the pages covered by these lines as shown in Fig. 182.
These pages can be the very last pages in the book. The book
will then hold a complete record of cash received and expended
on the job ; a complete record of all bills received and the dis-
position made of the bills ; a complete record of freight receipts
in carloads. This makes a complete and satisfactory log of
the job, and the average contractor will find such a record a
good thing to have.
It usually happens that a number of blank pages are left
in the book when the job is completed. The wTiter, therefore,
completes his books by writing in them, after everything is
3i8
COST KEEPING.
cleaned up, a concise history of the job. The first page is used
as an index and here he indexes the items so that they can be
referred to. In this history he records how the job was secured,
pasting in chppings, if they will help, gives some idea of condi-
tions encountered, the weather, the satisfaction given by the
foreman, etc., and whether a profit was made or a loss sustained.
If a profit, then the places on the work where it was made ; if
a loss, then some ideas are given as to why the loss was incurred
and the lessons learned. This looks like a great deal to place
in the one little book, but it is simplicity itself when started,
and a book for each job gives a man a splendid record of a life's
work. It very seldom happens that the head office ever con-
siders that a man has such records, therefore the general run of
Co/vs/<;a'o^
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Fig. 182. — Double Page Ruling for Carload Freight Shipments.
foremen are at perfect liberty to keep them, and in this way
reduce their experience to writing for guidance in future work.
The daily record is an importan^t subject. The writer has
used the form here given (Fig. 183) for a number of years.
He has been employed by firms that asked him not to bother
sending in a daily report, but he always replied that if he did
not make it out every day he would soon try every possible
means to avoid making out a weekly or monthly detailed report.
As some daily idea is wanted of how the work is progressing,
this report should be made out daily. It takes only a few min-
utes and when done is a great convenience to have to refer to ;
besides, a record like this is very valuable in case of lawsuit.
Lawsuits cannot be always avoided. The sheet of paper is 8^x12
ins. The lines ruled for records are 34 of ^"^ \x\q\\ apart. There
are nine lines for the payroll division, six lines for the material
MISCELLANEOUS COST REPORT BLANKS.
319
subdivision, five lines for the record of bills received and ma-
terial ordered, and four lines at the bottom for the daily progress
statement, which is continued on the back by reversing the sheet.
The back is unruled.
The report is made out generally in lead pencil and a car-
lx)n copy made. The original is sent to the home office and the
carbon kept on the job. Such a report, it may be readily seen,
lends itself to any job or class of work. If the job is large and
DAILY REPORT „o«_
OaJok Fof
Ddlr Rev«<1 mint ba mailed ach cmung. hicliKlii« Sondayrand Holiday!, <_
information necessary to enable Home Office to keep in doae touch with the work.
Accidcata must be mentioned in this report and ' " ' ' ' " *
H no woric i> doM the (act. with
be reported. Give 1
LABOR DISTRIBUTION utf WORK DONE
Hoars Rate Amount Occnpatloo
MATERIAL USED
MATERIA. RECEIVED
Aaoaal UniU
Kind When
STATEMENT OF BILLS RECEIVED
This sUtement refers to bills enclosed wilb Daily Report. AH
* * wzT\ci the day received. Send copy if the original cannot
and lomTifA tl
biUi in duphcau
MATERIAL ORDERED
(Eodosc carbon corv ol order )
;^::^Ow^^wx^^^%«s7
DAILY PROORESS. State here fufly the I
. maps, profiler
icntial. Use b
I day, with amount of work done and give eafisea of delays.
1 order that prosresa may be noted 00 office dopiea.
n preference to using two or more sbecu of paper, turning c
(Put Date on this line aiw)
Fig. IS3.-^T3aiIy Report.
divided into a number of classes or sections, then such a blank
can be filled for each. It does not necessarily mean that all
the details of a large job shall be crowded on to one small
sheet if more space is really required. The main thing is to
have a record of all that is done each day, and have on the
record enough information so that cost statements can be worked
up from it and unit costs derived when wanted.
The time to distribute the cost accounts is each day as the
work is done. Records are made of delays and why they oc-
320 COST KEEPING.
curred. If high costs are encountered, the daily report shows
why and how.
The writer, and every man engaged in this kind of work,
knows that very few firms work up their cost records as they
would have us believe they do when they read papers before
societies on the subject. Much data is collected that is never
made use of in the future. Elaborate blanks are often prepared
that fall into disuse a short time after adoption. Therefore the
importance of having a plain, common-sense record of daily
operations can be appreciated. Some firms do not want daily
reports. Others go to the other extreme and want more than
the one lone man on the job has any right to be expected to give,
and instead of having a first-class foreman on the work, they
make the bookkeeping part take so much of his time that they
have a high-priced and incompetent accountant on the job, which
is allowed pretty much to run itself. More complaints are
received by the foreman about the poor w^ay in which he sends
in his reports than about the loss of money on the job through
neglect of his work.
The payroll deserves a section to itself, and another article
will take up this important subject. For the average job on
which a man will be sent away from home to manage, the com-
mon payroll books to be found in every stationery store will
be sufficient. After all, it simply requires that the time of every
man be kept properly. To avoid taking too much time in copy-
ing names, it is well to use on a weekly payroll the one-week
books; on a bi-weekly pay roll the two-week books, and on a
monthly payroll the monthly books. They cost five or ten cents
each and fit nicely in the pocket. Such instruction seems elemen-
tary, but the writer has run across men whose books were so
marked up because of the wrong blank having been started with,
that a little elementary caution about payroll books seems neces-
sary. When a job requires fewer than loo men, the ordinary
stock payroll book will be all right. It is only when a larger
number of men are employed that something better is required.
The keeping of accounts on an ordinary contracting job is
very simple. It is, however, absolutely necessary that the work
required be performed every day. Five to ten minutes per day
will do it, v^hereas letting it go to the end of the week or to any
more convenient season means, very often, almost invariably,
MISCELLANEOUS COST REPORT BLANKS. 32I
a quarrel with headquarters. Five minutes each day is a short
time and can be spent after quitting time to advantage. The
feeling of satisfaction coming with completed work is fine. Five
minutes per day accumulates until it means half an hour on
Saturday and many times means more than this, for the spirit
that leads a man to put off the five minutes makes him careless
about placing his papers where he can lay his hands on them.
Many times the disinclination to do the five minutes' daily work
has cost a man an afternoon and night of worry on Saturday
or Sunday. In fact, if the work is let go until the end of the
week, it is generally neglected until Sunday night, and then the
Monday begins with headache and clouded mind.
The cash report has been dealt with as one of the items com-
prising the weekly report. Accompanying it should be all the
vouchers, in the shape of receipted bills, cash slips, receipts for
money paid, the payroll and cancelled checks returned from the
bank.
Bills paid by check from the home office are sent there daily,
after copying in the bill record book. They are also noted on
the daily report as shown. It is important that the bills be sent
in daily so the home office can take advantage of cash discounts
and bills paid locally should be met promptly for the same rea-
son. This cash discount is an important item as affecting credits
and profits, so some explanation may be of benefit to young men
just embarking in business or on their first independent job.
The following explanation from Ryerson's Monthly can
hardly be improved upon:
"A Cash Discount is a premium or inducement offered by
a merchant to his customer to pay a bill before it is due.
Cash Discounts vary in the several lines of trade and their
importance may be judged when it is stated that in some large
concerns, the total profits at the close of a year's business are
represented by the savings through taking advantage of all
discounts.
Some houses have the terms and discounts fully and plainly
stated on each invoice ; others mark it, for example, "30 — i-io,"
which means the bill matures thirty days from date, but if paid
in ten days a discount of i per cent from the face of the bill
may be deducted.
322 COST KEEPING.
All progressive business houses take advantage of every
cash discount that equals or exceeds the prevailing rate of in-
terest. The values of various discounts are :
60 days, less 2 per cent. — 10 days = Interest at 14 1025 per cent.
60 days, less i per cent. — 10 days = Interest at 7 1-5 per cent.
30 days, less 2 per cent. — 10 days = Interest at 36 per cent.
30 days, less i per cent. — 10 days = Interest at 18 per cent.
30 days, less ^ per cent. — 10 days = Interest at 9 per cent.
30 days, less ^ per cent. — for cash. = Interest at 6 per cent.
To present it in another way. If you have purchased a bill
amounting to $300 on terms of 30 days — less i per cent, if paid
in ten days and the prevailing bank rate of interest is 6 per cent,
you could make a saving of 12 per cent, by borrowing the neces-
sary amount from your banker and discounting the bill.
I per cent on $300 = $3 ; 6 per cent on $300 for 20 days =
$1 ; amount saved, $2. Which equals 12 per cent on $300 for
20 days."
We thus see that in the course of a year considerable sav-
ing may be made and profits enhanced by discounting bills.
If discounts are taken, common honesty requires that pay-
ment be promptly made according to stated terms. If the dis-
count time is ten days, do not let it run over that time and then
deduct it. The merchant feels, and justly, too, that he has been
defrauded out of a portion of his profit. The consequent dam-
age to the credit of the tricky purchaser is of greater moment
than the small amount he may have gained by taking an extra
five or ten days to which he is not entitled.
The bills paid locally and shown in the cash report should
be folded so they will be 3j^ ins. wide and be less than 9 ins.
long. On one end should be a memorandum giving date of bill,
amount and name of firm. Receipts and cash slips on small
pieces of paper should be pasted separately on sheets of regular
letter size and folded and marked in the same manner. These
vouchers should then be arranged in order to correspond with
the items in the cash report so the clerk at headquarters may
readily check the items. Put a band of paper about four inches
wide around the bundle, leaving the written memoranda clear,
and on the band write :
MISCELLANEOUS COST REPORT BLANKS. 323
Cash Vouchers.
Week ending 19
Job
Foreman
This should be written on both sides, but is really not re-
quired except upon the side showing the memoranda on the ends
of the folded vouchers.
The payroll report should not be enclosed with the cash re-
port vouchers, as it is a separate matter, like bills paid from the
home office. If the company has no special form for payroll
report that shown by accompanying blank, Fig. 184, is a good one.
This form is used when men are paid by check or in some
way not requiring the payroll to be receipted. If the payroll
PAY ROLL Week Endtnc
19
Job at
'
Contractor
Owner
No.
Name
Occupation
Rate
Time
Amount
Day
Hour
Days
Hrs.
Fig. 184. — Payroll Report.
has to be receipted two more columns must be added : one to
contain the name of the workman, the other that of the person
in whose presence he was paid. This person should be some
one besides the foreman, who signs the roll at the bottom as
''Correct," so there will be two witnesses.
In arranging the payroll report put at the head the head
man, letting each line hold the name of a man lower in position
or authority than the preceding line, until the ordinary laborers
are reached, when they will be placed according to number.
In the columns giving rate of pay such an arrangement groups
men by pay and makes the report easy to check. In these
columns use "ditto" rnarks instead of repeating the rate on each
line. Never use "ditto" marks in the columns headed "Days"
and "Hours" no matter how many men have the same time, and
never use "ditto" marks in the columns headed "Amount." The
payroll report should be in duplicate, the original sent to the home
324
COST KEEPING.
office and the copy kept on the job. It is well to make the report
in lead pencil, using an indelible pencil, and have a carbon copy.
Placing a damp blotter over the original will bring out the
marks clearly and "set" them.
A regular order blank should be used for all material and
as these blanks are stock forms carried by all stationery stores
no particular form need be given here. No matter how unim-
portant the purchase, always make out a written order. If
goods are ordered by telephone the written order should be
mailed and marked ''Confirming telephone order." Two car-
bons should be made of every order. The original should go
to the dealer, the duplicate be mailed to the home office with
the daily report, and the triplicate be filed on the job to check
the bills when received. It is understood, of course, that there
is a letter file on the job in which to keep correspondence and
carry papers. When bills are received they should be checked
with the copies of orders and each order marked ''Billed
19. . . .," to guard against a second billing for the
same material. All orders should be numbered consecutively and
in checking bills the order number should be marked against
each item. If an order is spoiled mark it "Spoiled" and send
the original to the home office to preserve the sequence, and file
the spoiled carbon.
Never pay money without a receipt. Carry a receipt book
always and have the receipts numbered. The stub is the job
record and the receipt is sent in with the weekly cash report as
a voucher.
Have the bank book balanced weekly. Check all cancelled
returned checks on the stubs of the check book. With the weekly
cash report send all returned checks to the home office. Arrange
them according to number and date. Place around them a band
of paper endorsed thus :
Checks Returned.
Week ending 19. . . .
./. \ Job
Foreman
Checks amount $
Outstanding numbers
amounting to $
MISCELLANEOUS COST REPORT BLANKS. 325
One or two pages should be ruled in the cash book giving
the number of each check, the date and amount. A final column
should give date check is returned canceled to home office. The
foreman can thus keep track of checks issued and go after men
who are disposed to keep them. No check should be out for
more than a week. Payments the last week or two should be
made in cash so matters can be closed up at the bank properly.
If the workmen are paid by check there should be a separate
check book with another series of numbers. For example, the
regular check book may begin with i and the labor account
check book may begin with looi. A rubber hand stamp should
be made for pay checks reading about as follows:
This check is accepted as payment in full for labor
and all services rendered to and including the date
hereon, by the undersigned payee for
on the job in the city of
the blank spaces, of course, in the above form, containing the
proper names, as they could not be filled in with pen within any
reasonable expense. That is, there should be a rubber stamp
for each job. If the cost will not be too great the above could
be printed on the back of each check. The place for this re-
ceipt is across the upper end on the back so the first endorsement
by the payee comes under it. With such a receipt it is unneces-
sary to have the men sign the payroll.
When making the weekly cash report put the returned pay
checks in bundles, having a wrapper endorsed:
PAY CHECKS.
Week ending 19 ... .
Job
Foreman
Amount of payroll $
Checks herewith $
Numbers out
The payroll is, of course, the voucher for labor cost each
week, but the following week nearly all the checks will come
in and can be sent on, thus completely vouchering this item.
The pay checks for each week should be kept separate even when
there may be only one. When received at the home office the
clerks there will collect them and by cleaning up every paper each
326 COST KEEPING.
week on the job the foreman is reheved of the worry of having
several items to keep track of until each account is complete.
At the home office there are men employed to keep accounts.
The foreman on the job has merely to send everything they re-
quire in the way of information and send it in such a way that
it will be clear to all concerned. He has no business keeping
payroll checks until they are all in. He has no business keeping
any papers relating to unfinished business. His desk must be
kept clean no matter how the clerks at home growl. They have
the facilities for caring for the information and in proportion
as the business grows the more thankful they are to have a
conscientious, careful foreman on the out-of-town job.
The accident report is something that must be attended to
very promptly. All contractors carry some accident insurance
and the companies are strict in regard to having reports made
promptly. No time should be lost in making out the report and
mailing it to the proper address.
In this particular considerable trouble arises. When a man
is injured common humanity demands that such relief be given
him as he requires. There must be no delay, for delays are
sometimes fatal. Therefore, the foreman should have some band-
ages and appliances and supplies on hand for first aid work and
should know how to use them. The aid should be given promptly
and the injured man and his friends should be made to feel
immediately that the boss sympathizes and is anxious to get him
fixed right.
Owing to the insurance matters, however, we generally see
a rather scared, and sometimes a badly injured, man sitting help-
lessly holding to the injured place while a lot of helpless looking
men hang around waiting for the surgeon, and the foreman who
should be competent to give some help, is worrying everyone with
questions and showing about as much sympathy as Jack Frost
shows for the tender bud in the early spring. So far as the men
see, the boss cares nothing for the injured man but is merely
intent on getting the information required by the insurance com-
pany. The men also know that there is nothing humane in the
business at all but that the insurance company intends fighting
the case at once. In the picture can be seen the seeds sown for
a fight between the injured employe and the unknown corpora-
MISCELLANEOUS COST REPORT BLANKS. 327
tion that has insured his boss against claims from him. Such
things breed antagonism.
The things the insurance company wants to know about the
man are simply his name, age, address, occupation, whether mar-
ried or not and his nationality. When he is injured and scared,
for all these strong fellows get terribly scared when hurt, it is
heartless, to say the least, to annoy him and his friends with such
questions, especially when they all know it is for the purpose of
giving information to an indemnity company. The time to col-
lect such facts is when the man is hired. There may be one
hundred men constantly at work. Owing to the shifting con-
stantly going on there may be a total of several hundred men
engaged upon the work during its progress and it is a bare pos-
sibility that none will be injured. Nevertheless it pays to keep
all the statistical information ready for use when wanted. A
man may be killed and his companions may not be able to give
information when questioned. The class of lawyers known as
"ambulance chasers" is annoying, and it often happens when a
man is carried home that a representative of one of these harpies
has been there already and the mouths of the family are closed
tight.
The writer has on each job a small plain book with a couple
of hundred pages. Each man has a number and it happens
always that in ^the progress of the work several men will have
the same number. Each page of this book has a number and he
puts on each page the name of the man who has the number on
that page. As each page has between 20 and 30 lines it is pos-
sible to keep a complete record of the names of men who have
had the number. Following each name is put down the date
the man started to work. The day he stopped may, of course,
be put down, but it is not necessary and is often neglected. This
book is merely an index to keep track of the names attached
to the numbers.
For keeping track of the men he has small cards, 3x5 ins.,
in a small pasteboard box with an alphabetical index. Such an
outfit costs about 50 cts. The cards may be purchased with
printing on, providing lines for the name, address, nationality,
etc. These are stock cards. On the other lines may be put
down whether a man is married, his age, number of children,
etc. When a man is hired a card should be filled out with this
328 , COST KEEPING.
information and the number he is given should be placed on
the card. The date he begins is there also and these cards are
very convenient to have to keep a record of the man throughout,
if he is a man who may be good enough to attract the atten-
tion of the boss while he is on the job. Having filled this card
it is filed alphabetically and on the book containing a record
of numbers, the name is put down. When a man is injured it
is just possible he can say nothing so he will be identified by
the number attached to his clothing. By referring to the num-
ber record book, or to the time book^ his name can be found and
on reference to the card index his residence and accident in-
surance information will be found. These preliminaries being
out t>f the way it is possible to show the proper sympathy
and give the man first aid. Promptness and efficiency in these
two very important particulars have a wonderful effect on the
men. After the injured man has gone the witnesses may be
brought in one at a time, and their evidence obtained. The
accident report may be filled out, the record completed on the
card and the foreman is ready then for the next accident. In
such cases it is highly important that there be due regard for
common decency and everything possible should be done to avoid
giving offense. Common laborers at such time feel particularly
helpless.
Each foreman will have, of course, a book containing the
names and numbers of the men under him. This book he is
supposed to check with the timekeeper daily. It very often hap-
pens that the job is so arranged that the work can be attended
to by the timekeeper alone and the foreman will not be required
to keep track of the men. In the majority of cases when this
can be done it is a decided advantage. If the foreman has
nothing to think of but his men and getting the most possible
out of them, he will do his work satisfactorily. When he has
to keep a book, however, and make entries in it, he loses much
time.
The timekeeper should go over the job twice each day. In
the morning between eleven and twelve and in the afternoon
after four o'clock. His time book should be arranged with a
page for each foreman and his men. The names of the men
should be arranged consecutively by number. This will insure
the least possible loss of time in getting the time.
MISCELLANEOUS COST REPORT BLANKS. 329
On some work employing a certain class of men, and espe-
cially in large cities, the men shift frequently. In a city like
Chicago, in certain sections, the common laborers seldom stay
more than two or three days. They may work on the job sev-
eral times a month but only for very short periods. The law
requires that a man be paid in full when discharged, and these
fellows generally manage to be discharged, for if they left
voluntarily they would have to wait until pay day for their
money. The obvious thing to do is to learn to know these men
and after awhile decline to employ them. It often is the case,
however, that men are not too plentiful and some of these fel-
lows are really good workers when they do work, so it is well
to ignore their peculiarity of wanting to draw their pay too
often and merely arrange the time keeping system so they can
be kept track of. Here is where the number system is awkward
and sometimes to oblige the timekeeper and to simplify his work,
good men are refused employment after they have quit several
times. It is not always possible to save numbers for such fel-
lows. The writer makes it a rule to avoid duplication during
each pay day interval. That is, if pay day comes each Saturday,
a number will be given only once during the week. If pay day
comes twice a month, then the number is given out only once
in the two weeks. Such systems cannot be always followed if
one has a small supply of numbers. On a job requiring 100 men
Aere should be about 300 numbers to carry out such a system.
The writer generally figures on having about twice as many
numbers as he has men on a job constantly employed and then
giving out a particular number only once between pay days. It
has happened in seasons of the year when the weather conditions
were very bad and there were frequent lay off periods, that such
a supply of numbers was not suflFicient. This occurs in large
cities, as a rule where work is being done in the vicinity of large
industrial establishments where indoor work may be had. The
common laborers will do their best to secure an indoor job as
soon as bad weather comes on and will hang around the big
establishment until their money is gone before applying for an
outdoor job on construction. So it often means that after a
couple of days' lay off almost an entirely new gang has to be
hired. The matter is complicated often by some of the older
men turning up some morning and getting their number in the
330
COST KEEPING.
first seven o'clock rush, and thereby causing lots of trouble when
the new man who has that number comes in two minutes later
and demands it. Such little problems the time keeper must
wrestle with and get up schemes to make his work as easy as
possible.
The writer used for years on his work a silicate slate book.
These books may be obtained at almost any stationery store
and have four, six or eight pages, ruled in lines for names/
On the right hand edge rule a line and put down the numbers
in ink. An acid ink is best. On the line opposite the numbers
put the names of the men in lead pencil. By dampening the
finger the name may be readily erased and when the man goes
off the job his record will be completed in the time book and
his name erased from the silicate slate. On the line opposite
the number put down the date on which that number may be
again allotted. When the number is given erase the date and
put down the new name. On the left hand edge of the page is
to be ruled a column in which may be entered the time daily.
The advantage of such a book is that the time may be
obtained on a job very rapidly and with the least number of
mistakes. Every man is supposed to have conspicuously dis-
played a numbered badge. When the timekeeper goes out for
the time he can stop each man he comes to, regardless of where
he finds him, and turning to the number in his book ask the
man his name. If it agrees with the name there he checks the
time and goes on. After a while he, of course, learns the names
of most of the men. It is an easy matter to check all the men
after going over the job. If some have been missed the fact
is discovered before returning to the office and the particular
num.bers can be hunted for. This is very much better than
taking the time from a foreman's book. It eliminates favoritism
and occasionally a foreman will put a man down as working
merely to save time for himself, when the man may really be
soldiering in the brush.
Upon returning to the office the time is transferred to the
time book. On going out in the morning the men entitled to
full time are checked off with a vertical mark. If only part
time the number of hours will be set down. In the afternoon
a cross mark will indicate full time. The transfers are made
to the time book after the afternoon round. As each transfer
MISCELLANEOUS COST REPORT BLANKS.
331
is made the timekeeper must cross out on the slate, the time
record for that day. After all the entries are made he should
go over the slate ver^- carefully indeed to see that everything
has been entered properly, and thus avoid troubles on pay day.
The only objection to this system is that the record taken on
the job is erased and if an entry has been forgotten the workman
will have a right to complain. Care, however, will prevent this.
The writer in handling thousands of names in nearly twenty
years of work has had so very few cases of trouble that he
believes this system very good. Trouble will always come up
about time, no matter what system is used.
An improvement on this system would require a slip for
every man every day and the making of these slips would take
too much time. The timekeeping must be done with a minimum
of work. If ordinary time books are used the constant changing
of the men makes it annoying and very often a timekeeper gets
mixed on his numbers. By having the silicate slate book the
vacant Hues always show at a glance the numbers available for
new men and the dates on which they may be given out. Dupli-
cate numbers on the pay roll can then be avoided and the pay
roll easily made up on pay day for the report to headquarters.
Every man should have a number. Foreman and time-
keepers complain that the men do not like to wear the numbers
where they may be readily seen, and if not in plain sight much
of the object of having numbers is defeated. A small, round
brass tag with a hole to which is attached a strap is often given
to the men, who hang it to a button hole like a watch fob. This
is too low down on the person to be readily seen by the time-
keeper and is in a place where the lifting of materials may
tear it oiT. A number attached by a safety pin and worn on
the breast is often knocked off when men have to lift heavy
loads or climb to some position where they can work. The
fact that the missing check is charged to them makes many
men carry the numbers in their pockets and time is lost w^hen-
ever they have to produce them for the inspection of the time-
keeper. The writer believes it a good idea to have brass checks
about the size of a silver dollar attached by a catch pin to the
hat. Here it is out of the way and is readily seen. So far he
has had few men object to wearing it there. The check should
have not only the number on it but the name of the company.
2,2,2 COST KEEPING.
The men, of course, must pay for lost checks in order to teach
them to be careful.
These systems here described are intended for the small
contractor and the man who is sent from home and who for the
time being is practically a small contractor. Large concerns
will have their own methods and blanks and a book of instruc-
tions to guide foremen. Gilbreth's ''Field System" is an excel-
lent book for every man to own who is in charge of work. The
way to obtain costs from the papers and books here shown will be
given in the following article.
On the subject of paying men, a few words will not be
amiss. If there ever was a fiendish invention devised to keep
contractors and their men apart it was the invention of the
payment of common laborers by check instead of in currency
and coin. It saves very little work for the timekeeping depart-
ment and is a most inhumane proceeding. The writer never
does it if permitted to do otherwise. The men feel awkward
in going to a bank. No matter how considerate the bank offi-
cials may try to be, offense is easily given and very often a
supercilious young fellow irritates the poor, ignorant men who
go in. The question of identification is something that must
be attended to and the bank officials, working on salary, cannot
take too many chances. All this is very bewildering to the men.
Banks close earlier in the day than the workmen get off,
so they must go at noon to cash their checks, and oftentimes
they stay longer than they should. If they cannot get off to
cash the check they have to go to a saloon. The saloon is the
place to which they go naturally, because there is no bother
about identification. The saloonkeeper is glad to see them and
the check is cashed cheerfully. Several saloonkeepers in differ-
ent cities told the writer that they figured on getting 75 per cent
of the money back into their cash registers within five or six
hours after cashing the checks.
In paying money to the men it is well to know that nearly
all of them owe a little money to the stores at which they trade.
If they are paid in bills of large denomination they will go to a
saloon to have the bills broken, for if they sent the large bill to
the storekeeper he would keep his debt out of it. If they owe
nothing at the stores it is almost impossible to gtt any bill
MISCELLANEOUS COST REPORT BLANKS. 333
larger than five dollars changed, and frequently the small store-
keepers with whom such men trade cannot change a five-dollar
bill. They do a small cash business in which the amounts seldom
run higher than 50 cts. and they have very little money on hand.
In fact, in many sections it would not do for the storekeeper
to let his customers know that he keeps more than a few dollars
on hand.
In paying men, therefore, a rule should be adopted to the
eflFect that no man will receive a bill larger than $5 and that no
one bill shall amount to more than half the total pay, and that
not more than half of a man's pay shall be in one bill. If a
man, therefore, earns $11, he will receive one five-dollar bill
and the rest of the money will be in small change, and small
bills. If he earns $9 he will not receive a five-dollar bill, but all
his pay will be in small currency and change. By adopting such
a rule the writer on several occasions has kept his gangs filled
when other firms who were careless of the men's feelings had
difficulty in keeping a full force at work. It was surprising to
see how the men slighted the saloons when they were paid in
small change. Most of the workmen went to the saloons as
banks and money-changers' establishments and not because they
really wanted to go there before going home. The day has gone
by when the workmen on a job are to be considered merely as
so much machinery. So far as the personal relations go, they
are machinery, and to recognize the human element too much
lowers efficiency. By treating them humanely, however, they
respond very quickly. In no way can sympathy be more quickly
established between the workmen and their foreman and em-
ployers than by treating them on pay day as if they were getting
something they were entitled to. They feel they have earned
their money and resent any lack of feeling on the part of the
timekeeper and the paymaster. The writer on pay day has the
watchmen and foremen keep the men in line and accompanies
the paying off with badinage and jokes as the men file by. It
is easy to do and they stand around cheerfully. Too often on
pay day the men are yelled at and treated disgracefully. It is
as easy to grin as it is to scowl, and grins are always reflected.
So are scowls. The writer has never yet witnessed a pay day
when loud yelling and brutality on the part of the men who
keep the men in line was justified, yet he has witnessed it many
334
COST KEEPING.
a time. Not that it is common on the majority of jobs, but it
is unfortunately too common simply because of the attitude of
some men being like that of the policeman who apologized when
he hit a man by saying, ''No offinse, sur. I don't bate ye because
I hate ye, but ye see I have de autority."
The methods taken up in the preceding articles are account-
ing methods pure and simple. They show merely how the man
in charge on the job reports to headquarters all his doings day
by day so the accounting department can attend to its business
properly.
On the daily report is a section devoted to the distribution
of labor cost. This cost is obtained by making trips over the
work and ascertaining as closely as possible what each man is
doing, and such data are obtained readily when the timekeeper
makes his rounds. It is not necessary to split cents on this
matter. Each foreman can give a pretty good account of what
he has been doing with his men. These costs will be distributed
after the collector gets back to the office.
Bearing in mind always that large concerns will have their
own methods and that blank forms will be supplied on which
to collect and report this information, the methods to be adopted
by the foreman in charge of work for small concerns can be his
own methods, changed, perhaps, for each piece of work.
A blank book ruled in squares, six, eight or ten to the inch,
as may be desired, is a handy thing to carry round. It becomes
a regular diary and entries are made in it irregularly day after
day. That is, when going over the work and a certain piece of
work is going on, a stop can be made and the movements of
the men studied and their work timed. The notes can be made
in the book, and as it grows it becomes very valuable.
The writer has found a small case holding about 15 or 20
3x5-in. cards a handy thing to carry around on work. The cards
are ruled and at the top of one will be written a heading and a
date. For example, one card has on it, "Erecting gin pole on
Sumach Creek Power Plant, Aug. 15th, 1891." On the lines
underneath are data telling the size of the pole, the size and
length of the ropes used as guys; the number of men employed,
the tackle, and what the pole was erected for. Some account
was given of performance. Under the Gin Pole index in the
MISCELLANEOUS COST REPORT BLANKS.
335
file will be found a number of cards relating to gin poles on
different jobs.
A series of cards relating to Derricks, Engine Setting, etc.,
will be found also in the card index file carried by a man who
has been busy in such work for a term of years. This is the
sort of data wanted by the foreman. To be sure, a pretty good
knowledge grows on such matters and that is why experienced
men are more valuable as a rule than inexperienced men. Under
the modern system of ticketing information the new man gains
over the old very rapidly.
Labor is the hardest tking to estimate on any work. It is
the largest item on work generally. Because of the uncertainty
of the labor item many contractors go to extremes in the pur-
chase and use of machinery. A contractor may become "ma-
chinery poor," just as a farmer may become "land poor." The
reasons are the same in both cases. The ignorant farmer, unable
to make a decent living on a small farm, buys more land until
he can hardly earn enough to pay taxes. The more intelligent
farmer concentrates his efforts on a small place and gets along
well. A contractor who does not know how to handle men
properly, or who does not keep up to date on methods and whose
knowledge of costs is not allowable of analysis, sees himself
falling behind and blaming it on the labor, buys machinery until
he is too heavily loaded.
Old contractors are fond of telling of the times when a
sewer contract, for example, having been obtained, the con-
tractor hired a gang of men and they needed no foreman. Each
man knew his place and the work proceeded finely, the contractor
visiting it only occasionally. Nowadays the labor is always
ignorant and the best of supervision is required. Wages have
gone up and prices have come down. The remedy is obviously
machinery. This is the remedy in some cases, but not in all,
and the incompetent contractor cannot' differentiate.
Here is where the man with accurate cost and method data
comes in as a useful member of society. The writer has seen
a great many notebooks of contractors of the old school, and he
found very little matter of value from their own experience.
Their notebooks were full of clippings. They sneered at books
and book men and yet cut clippings freely from papers and
saved them for reference. They talked glibly of letting prices,
336 COST KEEPING.
but knew little about "doing" prices. They knew vaguely that
certain prices could be bid for work and there would be a "fair
profit." The words "fair profit" were overworked and the legal
profession still likes the term. Within a very few years the man
with well filled notebooks containing records of work he has
been in charge of and work with which he has been connected,
is in demand. The writer last year was talking with the president
of a contracting company who was bitter in his denunciation of
the publication of "method and cost" data, yet who kept for
several months an advertisement standing in a number of papers
for a man with records of v/ork covering not less than ten years.
His company wanted a chief engineer and manager with written
records of not less than ten years' work in a variety of employ-
ments, and he would employ no other. Yet he was angry be-
cause of the fact that methods and costs are things taught in
engineering schools, and talked feelingly of the good old times
when foremen and contractors were born and not made. Per-
sonally the writer prefers the manufactured article.
The previous articles tell the young man how to do the
clerical work that goes with every job, so he will make a good
impression at headquarters. This article attempts to show him
how to secure the data he requires for himself so every particle
of experience will be of value to him always. It is not so easy
to do it. How can he do it? Each job is an experimental labora-
tory. Professors and investigators make experiments on mate-
rials and the designer works from very meager data very often,
but relies implicitly upon it. The contractor must do the same.
Costs are of value in proportion as the conditions are stated.
It has been said they are of value only to the men who collect
the data, but if they are of value to the collector alone, something
has been gained by the collection and compilation. He is a
better man for his observations and deductions. His methods
will improve with his knowledge of costs, for the two are inter-
woven. Good methods mean lowest possible costs, and low costs
can be secured only by following good methods.
Take the gin pole, for instance. Records of a dozen jobs
on which gin poles were used showed that the last three or four
gin poles were erected in less than half the time of the first. On
the first job the young observer saw his first gin pole raised.
The foreman of the gang and his men had raised gin poles be-
MISCELLANEOUS COST REPORT BLANKS. 337
fore. On the next job the foreman was also an old hand, and
the young observer had nothing to do with it. On the third job
he noticed a little wrinkle and put it down approvingly. Finally
we come to jobs where he is a foreman instead of a timekeeper,
and one job shows how he put up a gin pole with some experi-
enced workmen and some ignorant laborers. The last three jobs
he erected gin poles himself as foreman with laborers from the
south of Europe who did not know English and who were green
at the work, yet the time was ridiculously short as compared
with the first job observed, and, of course, the cost was low. He
had learned. It had covered a period of fifteen years and during
that time only a few occasions had arisen for this particular kind
of work. If it had been left to the treacherous memory to record,
no record would have been broken. As the facts were recorded,
however, with sketches, it was an easy matter to refresh the mind
when such a piece of work came up and the experience of others
summed up in his experience produced results with which his
employer was well satisfied. Now, as he went at the work in a
proper and methodical manner, who can doubt that his men did
not have something added to their stock in trade of methods
and costs. Suppose he published the facts and showed how
he did it. We can believe that every man who reads it will
know better how to erect a gin pole and even if he does not have
one to erect today he can file the information in something more
durable than the brain tissues and have it ready against the time
he needs it.
In this manner the young man will collect his cost data,
remembering always that good methods and low costs are so
intertwined that they cannot be separated. This is why pub-
lished cost data are valuable. If the costs are very low, there
must be a reason. If due to good methods, then there has been
a distinct advance in knowledge for the men who work. If the
costs given are low because a mistake was made in omitting some
items, these costs are subjected at once to a rigid analysis by
men who know and there results another gain.
Some years ago, and it was not so very many years either,
a man was employed because he knew how to handle men. That
was always the sort of man wanted. Today the average em-
ployer wants a man who knows something about costs and is
well versed in methods. It is the same kind of man after all.
338 COST KEEPING.
but the employers have learned. The man they employ has be-
come methodical and therefore is a better and stronger man.
He knows how to handle men because he knows so well what a
certain piece of work should cost and knows so well the best
methods to save time and motion, that the men respect him. For-
merly the foreman had worked his way up. from the gang and
was obeyed because of the success he had made, yet his men
were free to criticize many times where their experience had been
perhaps slightly better than his. The trained foreman of today
commands their respect because of the unhesitating manner in
which he goes at things and because he knows just when to
come back to view the finished job.
Like timekeeping and bookkeeping and the making of daily
reports, the young man in a responsible position and the older
man in charge cannot spend so much time hunting for method
and cost data that they neglect their work, which is to keep the
men moving and the job going at fever heat. They are there to
obtain for the boss the most work at the lowest cost. He does
not care whether they collect cost data or not. If he wants it he
is willing to pay a man to collect it. He wants them to get the
work out of the men and machinery and to obtain for him the
largest possible profit on the job. Every minute spent on the
collection of cost data that can be employed in looking after the
job is a minute of his time lost.
Everything is useful. If a tab is kept of the time of men
going to the storeroom for tool supplies and it can be shown that
economy can be effected by putting in a couple of messenger
boys or even installing an intercommunicating telephone system,
then the time spent in observing this detail has been well spent.
If a few minutes spent in watching the moving of a derrick
results in the saving of a half hour on the next change, then the
time has been well spent. What the eager seeker after knowledge
must guard against is the habit of collecting data to such an
extent that a man degenerates into a collector of data and noth-
ing else. The writer knows men who can reel off costs by the
yard and by the hour and who know all about the best methods
of doing work, yet they are peculiarly helpless in directing men
in the doing of these things. Such men are spoiled in trying to
manufacture a foreman. Yet such a man on a job to help out a
born foreman is an experiment worth trying. It was done on
MISCELLANEOUS COST REPORT BLANKS. 339
one piece of work where a good hustler was sent to help out such
a man. The hustler knew how to keep men moving without
false motions and the other man knew the motions. It was an
ideal combination, for which the hustler, however, got no credit
finally. He is still working as a foreman and the other fellow
is president of a contracting company.
The collection of data is important and the study of methods
is important. The good man will learn to strike a balance and
not neglect his work, while getting data from it that will be of
service on succeeding jobs.
However, it must be said that just as it is necessary for the
accountant to know every item of expense entering into a con-
tract in order to strike a balance between expenses and income,
so is it necessary for the man in charge to know unit costs and
how to obtain them. Too much nicety in getting them is as bad
as too much carelessness. The segregation of unit labor costs
and unit material costs may really be made very broadly on the
general run of work. A close study of all the operations con-
nected with the conduct of the work and especially things that
take gangs temporarily from straight work, will well repay the
student.
INDEX.
Page
Aberthaw Construction Company's
System of Costs 193
Accidents 32
Accounting and Cost Methods for
Contractors 142, 312, 326
Accuracy of Reports, Checliing 96
Adding Machines 115
Air Compressor Report Blank,
Daily 233
American Smelting & Refining Co. 292
Analysis of Direct and Overhead
Expenses 12S, 130
Animal Body Considered as a Ma-
chine 27
Area, Measurement of 57
Arnold, William H 216
B
Balancing the Dead Load
Bank Check, Binding Form
Belt Conveyors for Short Hauls
Bill Copy Book
Bills, Duplicate 137,
Blackboard for Preparing Time Ta-
bles
Blacksmith Daily Report.. 86, 155,
Blasting, Duplicate Punch Card
(see also Rock)
Record Blank 152, 211,
Springing Holes
Bonus System 36,
Bookkeeper, Summary Record for.
148, 197,
Bookkeeping Defined
For Contractors 127, 289,
Single Entry Cash Book
Breakwater Concrete Daily Report
General Daily Report ,
Masonry Daily Report
Brendlinger, P. F
Brick, Handling
Laying, Fatigue in
Masonry Punch Card ,
Packets
Paving Record Card
Paving Record Punch Card
Brunsviga Machine, Multiplying.
27
324
25
316
316
6
234
167
234
212
38
272
65
313
314
243
240
241
252
26
29
169
26
160
172
115
34
Page
Building Construction. 154, 178, 188, 197
Burroughs Adding Machine 115
C
Cableway Work, Time Study on.. 9
Car, Performance Record 282
Report Sheet 181
Card, Attached to Each Piece of
Work 56
Index Order Sj'stem 122
Reports (Written) Versus Punch
Reports 71
Cash Book, Single Entry 314
Report. Weekly 315
Cast Stone Record Blank of Aber-
thaw Construction Co 207
Cement Curb (see Curb).
Report Card 181, 281, 285
Walk Record Card 161, 173
Central Power Plant 25
Channeling, Punch Card 88
Record Blank 153
Charges, Overhead 32, 130, 144
Chart of Cost 98,129
Of Efl^ciency 99,103
For Scheduling Work 6
Checks, Binding Form for Bank.. 324
Checking Accuracy of Reports 96
Classification Book, L'. S. Reclama-
tion Service 305
Coaching,, Value of in Field Work 12
Coal, Measuring 80
Quality of 7
Cofferdam Daily Report Blank 232
Colors for Designating the Differ-
ent Months 106
Competition, Law of 17
Comptometer, for Adding and Mul-
tiplying 116
Concentrating Work 25
Concrete Culverts 35
Foundation for Building 178
Mixing Record Card 157
Pavement Base 174, 175, 177
Summary Sheet 263
Wall Daily Report Blank 235
Work, Labor Processes in 52
Work, Units for 52
Work, Various 200, 280
342
INDEX.
Page
Contest, How to Arouse the Spirit
of 17
Co-ordination, Law of 5
Cost Charts, Obstacles to 7
Advantages of 64
Clerlf's Weekly Report Blank 292
Defined 65
Differences Between and Book-
keeping 65
Distributing ....143, 144, 147, 231, 280
Flexible System 154
Fundamental Divisions of
128, 130, 148
Hov/ to Start 69
Items, Express as PerceTita,ges
of the Total 30
Keeping 98
Objects of 64
Records Versus Bookkeeping
Records 66
Report Blanks, Miscellaneous 150
Report. Law of Regular 14
Reports, By Whom Made 71
Summary Master Card, Aberthaw
Construction Cc- 197
System Necessary to a Field
Chief 13
Counters 115
Crusher Daily Report Blank (see
also Macadam) 235
Culvert Construction Punch Card.. 170
Cummings, W. W 266
Cyclone Drill Co 215
Curb, Stone and Cement. . .173, 174, 177
D
Daily Reports (see Report, see
Time Report, see Class of
Work in Question).
Data, Gathering 1"!
Dead Load, Balancing 27
Work, Percentage cf and How to
Eliminate 23
Deliveries by Rail (see Freight).
Demurrage (see Freight).
Depreciation Account 1"9
Derailments 32
Derrick, Bull Wheel on 25
Erection, Hint CI
Performance Daily Card 283
Record Card 136
Record Punch Card 1 60
Spring Balance on 58
Designs, Make all in the Office 31
Diary of Foreman 82
Differential Bonus 45
Piece Rate System 38
Dignity, Law of 18
Page
Discipline : . . . 18
Discount Values, for Rates in Or-
dinary Use 322
Distribution Blanks (see Cost Dis-
tribution).
Divorce of Planning from Perform-
ance, Law of 10
Drawings, Key Units on 61
Dredging, Captain's Daily Report
Blank 228
Daily Report 219, 244
Engineer's Daily Report Blank.. 227
Engineer's Monthly Report Blank 229
Leverman's Daily Log Blank 226
Report Card System 215
Cost and Dredge Maintenance
Record System 220
Cost Keeping System 225
Summary Sheet of Cost 224
Time Book 222
Drill Hole Chart 209, 213
Drilling, Component Parts of 39
Cost Keeping 210
Daily Report Blank 233
Daily Report, Subaqueous 245
Gang Record Blank 154
Minute Observation Report Blank 235
Report Cards for Prospecting. . . 216
Report Blank for Well Drillers. 215
Record Blank for Test Holes
215, 283, 284
Record Punch Card 85, 168
Dump Train Record Blank 151
Duplicate Bills 137. 316
Punch Cards 90
Dynamite Boxes, Capacity of 80
E
Earth (see Excavation).
Educational Supervision, Law of. . 3
Efficiency, How Determined 8, 10
Chart of Steam Shovel V/ork 99
Chart for Channeling 103
Electricity Record 282
Emergencies, Extra Men on Hand. 24
Emerson, Harrington 8, 48
IZmerson, Sam W" 154
Employees, Rules for 4
Energy, Cost of Human and Horse 28
Equipment (see Plant).
Estimating 225
Excavation (see Blasting, Dredg-
ing, Drilling, Pipe Laying,
Quarrying, Railroad, Road,
Rock, Sewer, Steam Shovel,
Trenching, Tunneling).
Expense Account Report Blank of
Aberthaw Construction Co 205
Expenses (see also Cost) 123
INDEX,
343
Pago
Elxplosives (see Blasting).
Extra Men for Emergencies 24
Pay, Necessary Amount of for
Best Work 41
F
Falk, Myron S 2SS
Falsework, to Eliminate on Tres-
tles, Viaducts, Etc 31
Fisher, Magee 220
Flood Protection Work Cost Record
System 230
Follow-up Card Sj'stem 126
Food, Importance of 2S
Foot Pound Zl
Foreman, Diary S2
Duties of 2, 10
Functional 2, 3, 13
Plant 51
Freezing, How to Avoid in a Pipe
Line 32
Freight Shipments, Demurrage on. 2Se
Forms for (see also Materials) . .
ISl, CIS
Uniformity in 24
Functional Foreman (see Foreman).
Units of Measurement 59
G
Gang Report Cards 76
Gantt, H. L 45
Gas Pipe (see Pipe).
Gilbreth, F. B 3, 8, 26, 60, 116
Grading (see Excavation).
Gravity, Make Use cf, for Econom-
ic Operation 25
Groups, Handle Work in 26
Grouting, Units for Comparing
Cost of 54
Guarantee Construction Co.'s Sys-
tem 1S8
Guthrie, Keith 0 186
Gutter 173
H
Hall, M. G 154
HalHhan, J. P 253
Halsey, F. A 45
Hammatt, W. C 288
Hauling (see also Team, see
Transportation)
..54, 83, 151, 170, 176. 234, 236, 237
Rock, Daily Report Blank 234
Minute Observation Report
Blank 236
Hill, George 306
Hill. Geo.. System of 306
History of the Work 108
Page
Hod Carrying, Inefficiency of 26
Horse, Working Energy of 27
Humphrey, George R 28 i
I
Improvements Indicated by Time
Study 10
Individual Record Cards 80
Time Punch Card. Daily 87
"Information Wanted" Blank of
Aberthaw Construction Co 206
Interest Account 141
Charges, to Avoid Carrying 33
Values of Various Discounts in
Ordinary Use 322
Insurance, Accident 32, 142, 327
Company, Information Wanted.
by 327
Inventions and Inventors 11
Items of Unit Cost 21
K
Kaumeier Bros '. i,ji
Keating, C. S 230
Key Letters I94
Keys Marked on Separate Mem-
bers 62
Key Units of Measurement 61
L^'nits on Drawings 61
Kosmos Engineering Co. System. 278
L
Labor Distribution (see Distrbution).
Unions 16
Laborer (see Man).
Lathe Work 43
Laws of Management 1
Ledger, Loose Leaf Card 204
Sheet, Loose Leaf 178
Length Measurements 57
Ley, System of Fred T. Ley & Co. 256
Liability Insurance 32, 142, 327
Lockwood, J. B. C 225
Lost Time 30
Low, Emile 247, 293
M
McCullough, Ernest 312
McHenry 4
Macadam, Road Work 171, 285, 286
Street 174
Transportation Record Punch
Card 170
Machine, Extra Parts of 23
Reduce Cost of Attending 24
L'niform Loads 28
Maintenance of Way Gang Dupli-
cate Punch Card 91
344
INDEX.
Page
Man, House Near Work 28
Working Energy of 28
Using Low-priced 29
Management, Laws of 1
Erroneous Assumption in Re-
gard to Foremen 10
Managerial Dignity, Law of IS
Masonry 59, 168, 238, 280
Master Card 202
Material Foreman 2
Materials, Price Records 138, 208
Records 124, 221, 261
Report Blanks
94, 96, 136, 187, 192, 203, 271
Requisition for
93, 94, 95, 122, 123, 135, 137, 138, 303
Shipment Records
6, 181, 236, 284, 286, 318
Measurement, Difficulties of 51
in Stock Pile 60
of Area 57
of Length 57
of Weight 58
of Volume 58
Men (see Man).
Military Organization on Contract
Work 3
Minimum Cost, Rules for Secur-
ing 20
Mimeograph 113
Months, Colors for Designating 106
Moore-Mansfield Construction Co.. 166
Motion Timing and Study 8, 119
Motor Car Performance Record.. 282
Multiplying Machines 115, 116
Muscles, Which Ones to Use 28
N
Nash, Expeditious Measurer 62
National Cash Register Co., In-
structions to Salesmen 4
New York State Engineer 2SG
Newell, F. H 298
Night Shifting 32
Norris & Peugnet 248
Office Appliances 110
the Place for Designing 31
Labor, How to Charge 134
Methods 110, 120
Rules 118
Supplies, How to Order 139
Systematizing 116
Order Blank (see Materials).
Page
Output, How to Ascertain Possi-
ble (see also Time Study)
Measuring the
Overhead Charges, to Reduce
Expenses, Analysis of
39
50
32
130
Summary Sheet 144
Packets for Handling Bricks
Pay Day, Rules for
Pay Order Blank of Aberthaw
Construction Co
Pay Roll Sheet 132, 183, 263,
Voucher
Paving Brick 160, 172,
Cost Keeping System
Foreman's Daily Report 74,
Foundation Report Card
Inspector's Report 154,
Payment Systems
Peak Loads, Eliminate
Percentage, Method for Rating
Performance
Perry Time Stamp
Piece Rate, Principles Governing.
Rate Systems 36,
Pipe Laying, Bookkeeper's Rec-
ord 271,
Complete Record
Daily Pay Roll Report
Daily Progress Report
Drip Record
Leaky
Record Cards 158,
System for Recording
Pipe and Steam Fitter's Report
Card
Pipe Report Blank
Plant, Depreciation Account
Foreman
Hmts on Selecting
Interest on 139,
Reports on
Work Every Element to Its Ca-
pacity
Planimeter
Planning, Divorce of From Per-
formance
Power Purchased Account
Premium Plan
Price Record (see Materials).
Profit and Loss Accounts
Profit Sharing
Progress Blue Print
Charts 102, 104, 106, 107, 184,
Prospect Drilling (see Drilling).
Pumping. Daily Report Blank
Punch, "Conductor's"
26
333
206
323
133
175
151
175
171
177
36
23
112
45
272
276
269
270
278
277
268
266
166
2G^^
139
7
30
141
7
23
116
10
142
45
148
36
185
185
233
81
INDEX.
345
Page
Punch Card, Design of (see also
class of work in question) S2
Duplicate 90
for Drill Record 85
for Team Work, Daily S3
for Team Work, Weekly 84
Versus Written Card Reports... 71
Purchasing (see also Materials).. 135
Q
Quarry Chart 213
Daily Report (see also Rock). 239, 246
Record Duplicate Punch Card.164, 165
Record 231
R
Rail Deliveries (see Freight).
Railroad Construction, Cost Keep-
ing (see also Excavation) 247
Daily Report Blank 248, 249, 254
Monthly Report Blank 251
Weekly Report 255
Monthly Report 250, 255
Record Blank 294
Monthly Summary Blank 295, 296
Summary Sheet 262
Railroad Section Foreman's Record
Punch Card 91, 264
Reclamation Service, U. S 298
Record Card for Each Piece of
Work 56, C2
Recording Single Units C6
Regular Cost Reports, Law of 14
Reorganization of Work 13
Report Cards, Size and Kind SI
Reports, Checking the Accuracy of 93
On Materials and Supplies (see
Materials).
Requisitions (see Materials).
Reward, Law of Proportionate 15
Law of Piompt 16
Road (see also Macadam), Daily
Report Blank 285
Engineer's Weekly Report Blank 286
Special Cost Report Blank 287
Rock (see Blasting, Channeling,
Crushing, Drilling, Hauling and
Quarrying).
Roof, Cheap 35
Ross, Joseph 2S4
Rotary Motion in Operating Tools. 23
Rubble Masonry (see Masonry).
Rubber Stamps 113
Rules for Employees 4
for Minimum Cost 20
S
Scaffolding, to Reduce Cost of 31
Schedule for Construction 289
Page
Sewer, Cost Keeping on
74, 165. 174, 175, 186
Material Report Blank 187
Shifting of Men 7
Shop Work Versus Field Work for
Economy 35
" Shovel (see Steam Shovel).
Shoveling, How to Reduce Work
of 29
Operations Involved in 29
Single Entry Cash Book 314
Sketches of the Work 108
Slate Books 330
Slide Rule 116
Slope Wall Record Punch Card 168
Sodding Record Punch Card 172
Spring Balances 58
Springing Holes (see Blasting).
Standard Performance, Law of... 8
Standard Time 8, 9
Steam Shovel, Record Blank 150
Record Duplicate Punch Card... 162
StefCens, Chas. J 188
Stint System 48
Stock Piles 7, 60
Stone (see Rock).
Storekeeper's Reports 92
Street Pavement (see Paving).
Sub-contract Accounts 143
Subdivision of Duties, Law of 1
Supervision, Law of EducationaL . 3
Supplies (see Materials).
Surveyor's Pins for Field Measure-
ment 211
System Clerk 118
Systematizing, Need of Trained
Staff for 13
T
Task Work with a Bonus 45
Taylor, Fred W 2, S. 10, 13, 38, 42
Taylor System 38
Opposition to 44
Team Punch Card (see also Haul-
ing) 83, 237
Record Card 176, 234, 236
Test Hole (see Drilling).
Time Cards That Show Changes of
Occupation.. 73, 74, 75, 179, 194, 200
Clocks 110
Keeping Defined 70
Methods 301, 312
Report Blanks and Books
73, 75, 178, 179, 189, 194,
200, 222, 258, 259, 200, 294, 302, 319
Sheet with Key Letters 75, 179
Stamp, Automatic 112
Study 9, 10, 11
Table for Scheduling Work 5, 6
346
INDEX.
Page
Tool Record 138
Towne-Halsey System 45
Train Record Blank 151
Transportation Cost, Main Units of 55
Record Card (see also Hauling) .
84, 151
Record Card for Macadam Work. 170
Units of 54
Transport Men to Work 28
Trenching, by Cableway, Record
Card 159
by Cableway, Record Punch Card 163
Progress Chart (see also Sewer,
see Pipe Laying) 104
Trestles, Framing Bents for 26
Tug Boat Report Card of Bush
Terminal Co 217, 218
Tunneling, Daily Report Blank. 252, 253
Work Under a Bonus 46
U
U. S. Dept. of Agriculture, Office
of Public Roads 285
U. S. Reclamation Service 298
Unit Cost, Items of 21
Selecting 15
Functional 59
Key 61, 62
of Measurement, Uniformity in.. 53
of Transportation 54
of Work 51
Subdivision of 50
Units, Key 61, 62
Recording Single 56
Two or More for the Same Class
of Work 53
Page
Veeder Counter 115
Volume, Measurement of 58
Tables of 62
W
Walk (see Cement Walk).
Warner, J. A 216
Wason, Leonard C 193, 201
Water Pipe (see Pipe Laying).
Wage Rate, How to Fix 47
Tables 116
Wages, Proportional to Output 16
Water for Economic Transporta-
tion 25
Weight, Measurement of 58
Weight as a Basis of Wage Pay-
ment 59
Weighing with Spring Balances 58
Well Drilling Record Cost Forms. 215
Well Drilling Record Blanks of the
Nevada Consolidated Copper
Co 283
Worden, C. Arthur 123
Work, Foot Pounds of a Minimum 27
Workman (see Man).
Units of 51
Written vs. Punch Card Reports.. 71
Yard Work vs. Field Work for Ac-
curacy Zi
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Cements, Mortars ^
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